The bank will buy the technology, developed by Merchant Customer Exchange (MCX), to drive the expansion of its smartphone payment application Chase Pay.
JPMorgan Chase has announced the acquisition of the payments technology behind CurrentC, the mobile wallet that never went beyond the pilot stage. The bank will use the service to expand the availability of its mobile and digital wallet Chase Pay.
The technology was created by MCX, a network of the largest merchants in the US, which was the premier launch partner for Chase Pay in 2015.
The consortium was formed by major US retailers, including Walmart, Kohl’s, Target, and Best Buy, back in 2012 to develop their own payment solution. They saw the project as an opportunity to eliminate high transaction fees charges by existing mobile carries like Apple Pay.
However, last year MCX postponed the beta test of CurrentC and laid off 30 employees, following negative feedback and users’ complaints after the pilot period. The consortium said it will instead focus on smartphone payment applications for financial companies and will partner with other banks.
“When we think about ‘fintech’, we go through a ‘build/buy/partner’ evaluation to decide how we can get to market most efficiently,” said Jennifer Roberts, head of Chase Pay.
“MCX has been an important partner, and their technology complements ours, so we’re thrilled to deepen our relationships with the merchant community through the purchase of this technology. This will help us get to market faster.”
Launched in 2016, Chase Pay is now supported by a network of biggest merchants in the US, including Best Buy. Other retailers, such as Shell, Walmart, Phillips 66, and Wakefern will integrate Chase Pay within the next year or more.
“The MCX owners either individually or within MCX will continue to pursue solutions beneficial to consumers and merchants to bring balance to the payments ecosystem,” said spokesman for MCX.
The sum of the acquisition was not revealed. According to JPMorgan Chase, the transaction is set to complete in the coming weeks.
Last month, the bank, along with other companies, participated in the establishment of the alliance to develop financial solutions using Ethereum blockchain.
JPMorgan Chase plans to use the distributed ledger technology to improve its system maintenance and settlement times. It is currently developing an Ethereum-based platform that will allow to use a publicly available system for confidential transactions.
The bank is also a part of R3 CEV consortium and is working with other members to design blockchain solutions for the financial industry. Last year, however, it refused to take part in R3 CEV’s first fundraising round, while some of its original members decided to quit the consortium.