JPMorgan Chase is the latest bank to see the opportunity to offer new loan products to existing credit card customers.
From the end of the year, eligible cardholders will have two new types of loans available to them. One, called My Chase Plan, is a loan with a fixed monthly fee instead of an annual percentage. The other, called My Chase Loan, allows a cardholder to convert part of a credit card’s unused balance into a loan.
Company officials announced the new products at JPMorgan Chase’s annual investor day in New York on Tuesday.
Customers can apply for the loans online or through the JPMorgan Chase mobile app. Cardholders can also apply for My Chase loans over the phone.
The foray into digital consumer lending follows a similar effort by Citigroup, which earlier this month unveiled a new consumer lending product that allows some existing card customers to convert some of their lines of credit into a fixed rate loan.
The move aims to boost consumer lending at a time when overall lending growth is expected to slow.
CFO Marianne Lake said in her presentation Tuesday morning that with some weakening in business confidence and “recession indicators on the rise,” the bank would focus on providing “high-level loans.” quality “with high returns and few risk factors.
The bank estimates that its existing card customers hold around $ 250 billion in loans and lines of credit with other banks. This is a great opportunity for JPMorgan Chase to gain new mainstream business, said Jennifer Piepszak, CEO of Chase Card Services, during an Investor Day presentation.
My Chase Plan allows certain existing card customers to take out a loan and repay it in equal monthly installments “with a reasonable fixed monthly fee, instead of an APR,” said MaryJane Rogers, spokesperson for JPMorgan.
My Chase Plan loans are designed for purchases of at least $ 500 and will be available to existing customers of the bank’s Sapphire, Freedom, and Slate cards.
My Chase Loan will allow existing customers to convert some or all of their lines of credit into loans. It is also designed for large purchases and customers can choose between six and 24 months.
Customers can only submit claims at a retail branch if the branch is equipped with digital kiosks or tablets.