JPMorgan Announces Apple Pay Competitor

Tim Maytom

chase payThe largest US bank, JPMorgan Chase & Co, has revealed it plans to launch its own competitor to Apple Pay that will enable customers to pay retailers using their smartphones in stores.

Chase Pay will allow for payments in-store, in-app and online, and already has the backing of the Merchant Customer Exchange (MCX), a consortium of US retailers including Walmart, Target, Best Buy and Shell.

The platform will be launched in mid-2016 and will be made available to the 94m credit, debit and pre-paid card accounts that Chase manages. According to Chase, it will use the same technology that is used to scan gift cards, and will work on "virtually all smartphones".

"Chase Pay solves a number of pain points for consumers and merchants," said Gordon Smith, CEO of consumer & community banking at JPMorgan Chase & Co. "It will improve the customer experience and drive down the cost of payments."

The platform will use tokenisation technology, similar to Apple Pay and Google's Android Pay, to ensure transactions are secure, and will reduce online checkouts accessed via mobile to a single click in some cases.

While Apple Pay's high profile launch has seen it reach wide adoption, the mobile payments market in the US is still evolving, and the entry of a new player with strong credentials in the financial area will have tech companies worried, especially given the high-profile retailers that Chase has managed to secure. MCX has an existing mobile payments solution, CurrentC, but has not seen high adoption so far. Teaming with Chase could well change that.

"Our partnership links Chase and its customer base with CurrentC's extensive network of leading retailers, restaurants, grocery stores and fueling stations, which process over a trillion dollars annually at more than 100,000 US locations," said Brian Mooney, CEO of MCX.

"This is a significant milestone, not just for MCX and Chase, but for mobile payments overall as the industry continues to take shape. Everywhere CurrentC is accepted, Chase Pay will be accepted."