NEW YORK ( TheStreet) -- One of the biggest investment banks on Wall Street is making a change to its business model. Goldman Sachs (GS) is ready to lend money to ordinary folks like us.

Last month, the bank hired Harit Talwar, the former CMO of Discover Financial Services (DFS), as a partner. Soon, Goldman will begin offering loans online to both consumers and to small businesses as it looks to tap into a market worth nearly $850 billion.

It's a big change for Goldman. Previously, the only people who could obtain loans from the bank were its high-net-worth clients. Entering the consumer lending arena means taking on a growing field of competitors, from traditional credit providers like Wells Fargo (WFC) and smaller banks to the newer peer-to-peer lending websites like Lending Club and On Deck.

Goldman can establish a consumer lending business now because it converted from being an investment bank into a bank holding company during the financial crisis in order to receive protection from the federal government. This also allowed Goldman the opportunity to interact more directly with consumers. News of Talwar's hiring has been public. But on Monday, The New York Times explained how much clout Goldman's new hire was being given to quickly build out a consumer lending program. He'll have a staff of roughly 100, and Goldman's lending unit is expecting to launch new loans in early 2016, according to the article.

The moves are part of a broader shift among Wall Street's financial giants toward consumer and business lending. At big banks, those business areas are growing more important as regulation and capital rules crimp profit from other units, most notably trading. Meanwhile, the financial services industry's march toward digitization has made dealing with consumers more profitable than it used to be, creating opportunities for a bank like Goldman that doesn't have physical branches.

 

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