Goldman’s GreenSky Purchase Shows Blue Sky’s Belief In Online Lending – News
Now is a good time to lend people money to buy things online, at least if you’re one of those credit card alternatives that have taken over the age-old term “buy now, pay later” . Until recently, some of these companies could not get the investor time. But everything has changed. Take today’s offer, Buyout of Goldman Sachs for $ 2.2 billion GreenSky Home Improvement Loan Service. It provides some sort of rescue to long-suffering GreenSky shareholders. Until now, GreenSky had been a catastrophic investment: it went public at $ 23 in 2018, but was recently trading around $ 6, against a backdrop of slow revenue growth. Goldman pays around $ 12.
Meanwhile, our London reporter Mark Di Stefano reported today that UK online retail bank Monzo will announce its own ‘buy now, pay later’ loan product tomorrow. Monzo, who is popular with millennials, had tested a product he charged an annual interest rate of 19% for loans of six months or more. It sounds a bit too much like a credit card, of course, that these products are meant to replace. Whether the interest rate is in the final product won’t be clear until tomorrow. Either way, the Goldman and Monzo deals, following similar initiatives from PayPal and Square, show how many companies are entering this market.