Mastercard has collaborated with J.P. Morgan Payments to enhance customer experience by offering an innovative digital banking platform. This collaboration has led to the launch of the “Pay-by-Bank” service.
Pay-by-Bank is an open banking ACH (Automated Clearing House) payment service that allows customers to process bill payments from their bank accounts primarily as an alternative to card payment.
This platform will enable the customer to make direct payments and will reduce the requirement of manually entering the bank details at the time of payment processing. For billers and retailers, this will automate the customer onboarding process and will effectively diminish the cost and the risk of saving customer bank details.
JP Morgan has said that the service will prove to be useful for frequent payments including tuition, insurance, rent, health care, and utilities where ACH is the main payment method.
Mastercard North America’s Executive Vice President of Merchants and Acceptance Chiro Aikat stated of Pay-by-Bank, “billers and consumers both get greater payment choice, but the partnership also propels payments innovation on two fronts — in the ease of the user experience and in the security of data sharing.”
Both businesses have agreed to launch Pay-by-Bank this year with a limited number of billers and merchants in the US, with plans to broaden the platform further in 2023.
Max Neukirchen, J.P. Morgan Payments’ Head of Payments, and Commerce Solutions commented, “We are delighted to work with Mastercard on this solution as their open banking capabilities will transform the payment experience. Together, we will offer an attractive, simple, and secure Pay-by-Bank solution that gives choice to our clients and their customers who use ACH as their payment mechanism. The technology behind Pay-by-Bank reduces the likelihood of unauthorized transactions and frees our clients from the need to retain — and the responsibility to securely maintain — consumer banking information.”
