JPMorgan Taps Private Credit for Card Partnerships

JPMorgan Chase is exploring ways to ease tensions with its credit-card partners by considering partnerships with private-credit firms. The bank, the largest U.S. credit-card issuer by purchase volume, has been looking into whether other funding sources could approve some of the cards it rejects.

The tension between banks and merchants is a longstanding issue in the card industry. Merchants often want banks to approve more applicants than they would normally accept, while banks take on the risk of those borrowers defaulting on their payments.

JPMorgan sent requests to over a dozen entities to discuss potential partnerships with private-credit firms, which work behind the scenes to provide funding for credit-card programs. Private-credit firms raise money from investors and lend it out to businesses that fall below investment-grade debt.

Blue Owl, Blackstone, KKR, and Sixth Street are among the lenders whose executives have been approached about JPMorgan's program.