Large US banks like JPMorgan Chase, Bank of America, Wells Fargo have collaborated to introduce a digital wallet for online payments, reported the Wall Street Journal (WSJ). The digital wallet for online payments
Expected to be launched in the second half of 2023, the wallet would be operated by bank-owned fintech Early Warning Services (EWS), which runs money transfer app Zelle.
The wallet, which links with debit and credit cards to help users check out at online retailers, will operate separately from Zelle.
This move is being touted as an effort to compete with third party wallet operators including PayPal and Apple Pay. Specifically, Apple Pay, Apple’s mobile payment platform, is said to be a key competitor that has strengthened its financial services foothold in alliance with Goldman Sachs. The tech giant, in partnership with the investment bank, has already forayed into the BNPL space, and is also offering a credit card.
Besides, in February 2022, Apple said that it will offer the Tap to Pay feature on iPhones to help US-based businesses accept contactless payments. Initially, the new wallet can be used with around 150 million Visa and Mastercard debit and credit cards.
Plans are on to include other card networks at a later stage. In a blog post, EWS said that James Anderson will serve as the managing director of the new wallet, whose name has not been decided yet.
He said: “We hear from consumers that they want to utilise online payments from their trusted financial institutions.
“Early Warning is working closely with financial institutions to build a wallet that provides consumers a secure and easy way to pay. The wallet will also aim to deliver better business outcomes for merchants – including higher transaction approval rates and more completed sales.”