Amazon And Wells Fargo End Student Loan Partnership After Six Weeks

In what will likely go down as one of history’s briefest interesting pairings, Wells Fargo and have decided to call off the discounted student loan program after a mere six weeks of existence.

Called “Prime Student,” the plan called for Wells Fargo to drop half a percentage point from its student loan interest rate for those who had signed on for Prime Student subscriptions.  Prime Student also enjoyed the regular line-up of Amazon Prime benefits including free two-day shipping, video streaming and photo storage.

“That promotion for Prime Student members has ended,” a Wells Fargo spokeswoman said on Wednesday. She declined to provide further details of the agreement.

Amazon spokeswoman Deborah Bass also confirmed the termination of the partnership.

The goal for the program was simple: create a bigger customer audience for both firm’s products.  And though its time out in the wild was short, according to previous reports in the Wall Street Journal earlier this summer, the two companies had been talking about the partnership for more than a year.

The news comes at an inconvenient time for Wells Fargo, which just last week agreed to pay $3.6 million to the CFPB to settle claims that its student loan business misled borrowers, illegally charged certain fees, and processed payments in a way designed to maximize late fees.

Wells Fargo neither admitted nor denied wrongdoing.

But their partnership with Amazon did raise some hackles in the consumer protection community when it was announced — with detractors arguing that Amazon and Wells Fargo were essentially pouring inflexible and expensive loans into a pretty packaging to disguise their more nefarious features. Particularly at issue are Wells Fargo’s loan rates — which clock in at a 10.93 percent.

Pauline Abernathy, a former Clinton administration official now working for the Institute for College Access & Success, described the arrangement as “the kind of misleading private loan marketing that was rampant before the financial crisis.”

She had more positive things to say about the disillusion of the partnership.

“We congratulate Amazon for deciding to stop promoting Wells Fargo’s costly private education loans. Private loans are one of the riskiest ways to pay for college,” Abernathy said Wednesday.