In offering consumer and small business loans, Goldman is jumping into an area that has been very successful, TheStreet's Jim Cramer, co-portfolio manager of the Action Alerts PLUS portfolio, said on CNBC's "Mad Dash" segment.
So-called algorithmic lending is used by other companies including LendingClub (LC), Cramer explained. Unlike LendingClub, however, Goldman Sachs won't be involved in peer-to-peer lending.
"Algorithmic lending is proven to be so smart," with very few defaults over time, he added.
Consumers want access to credit, which is still difficult to come by. While LendingClub and eBay's (EBAY) PayPal aren't exactly going head to head with Goldman Sachs, the news of the bank's entrance into consumer lending is probably somewhat unsettling. Who knows, maybe there's room in the market for all three companies, Cramer said.
The new consumer lending strategy makes sense for the bank, given all Goldman Sachs' extra capital, Cramer concluded.