The latest perk for Amazon Prime members: a discounted interest rate for student loans.
Specifically, Amazon is teaming with Wells Fargo to offer the loans; the bank will offer a discount of 0.5% to Amazon Prime Student members.
Amazon Prime Student is half the cost of a regular Amazon Prime subscription, Fortune reports. Amazon wants to add members to the Prime Student program, and Wells Fargo wants to “communicate more broadly that [it’s] here to help” students, which it can do by gaining access to Amazon’s student customers, a bank exec tells Fortune; he says the anticipated reach of the program is “in the millions.” Plus, as he explains in a statement, the bank wants to “[meet] our customers where they are—and increasingly that is in the digital space.”
In the fine print on the program’s web page, Amazon notes, “Amazon is not a lender and is not affiliated with Wells Fargo. Amazon is in no way involved in the underwriting or origination of loans from Wells Fargo.”
The discount seems to have the potential for controversy (the Christian Science Monitor’s headline wonders whether it’s “fair”), but analysts are also wondering if it will have enough of an impact to be controversial.
As one tells Fortune, these are private student loans, which undergraduate borrowers typically only take out if they hit the federal loan cap. And the Washington Post crunches some numbers and finds that, in one hypothetical and typical situation, a borrower could save $453 over 10 years—and Amazon Prime Student costs $49 a year. (Borrowers, however, are not obligated to remain subscribed the whole time they’re in school.)