JPMorgan Chase & Co agreed to acquire Merchant Customer Exchange’s payment technology for its mobile and digital wallet application, Chase Pay.
The deal, expected to close in the coming weeks, will help Chase Pay better compete with Apple and Alphabet in the growing mobile-payments market in the US Financial terms weren’t provided.
With the deal, major merchants that are a part of MCX consortium, as well as non-MCX merchants, will be able to more easily integrate Chase Pay as a digital payment option in the future. MCX includes major merchants such as Wal-Mart Stores and Target Corp.
“We view payments as a growing space that we want to make sure we are connected to,” Jennifer Roberts, head of Chase Pay, said in an interview on Friday. “It’s a key strategic priority, and we’ll continue to invest in it.”
Chase Pay app launched in November with only a handful of merchants, including Best Buy Co. The company in December made an investment in LevelUp to bring its order-ahead feature for quick-service restaurants to its customers, and the feature has since been expanded to more markets, Roberts said.
The acquisition also marks a final chapter for MCX, a consortium of major retailers that launched in 2012 with the goal of helping merchants and banks create their own mobile wallets to compete with the tech giants. The effort struggled from the start: In October 2014, MCX disclosed that some pilot programme participants’ e-mail addresses had been stolen by hackers. And the app wasn’t user friendly, as consumers could only link their checking accounts or store credit cards, like Target’s REDcard.
MCX’s biggest member, Wal-Mart, decided to introduce its own wallet. Other retailers followed suit, and many also began accepting Apple Pay and Android Pay, the popular services from Apple and Alphabet, respectively. Wal-Mart plans to also roll out Chase Pay in the coming months.
MCX ceased development of its mobile wallet and refocused on supporting Chase’s mobile service last year, Bloomberg reported in June, after the group removed its own wallet, CurrentC, from the Apple App Store. While MCX said it would refocus on working with financial institutions, Chase was said to be its only bank partner.
“Consistent with its mission to provide secure, consumer friendly, and cost effective mobile payment solutions to the marketplace, MCX took advantage of this opportunity to have the solution expanded to the broader merchant community,” MCX said in a statement on Friday.
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