Chase teams with MCX on Chase Pay mobile wallet
It’s not easy to surprise the payments industry, but JPMorgan Chase did just that Monday when it announced the newest entrant into the mobile wallet market in Chase Pay.
And here’s the kicker: the much-maligned Merchant Customer Exchange is Chase Pay’s premier partner.
“Chase Pay solves a number of pain points for consumers and merchants. It will improve the customer experience and drive down the cost of payments,” said Gordon Smith, CEO of consumer and community banking at Chase.
Smith made the announcement about Chase Pay at the annual Money 20/20 conference here in Las Vegas.
Chase Pay, which is scheduled to debut in mid-2016, is both an in-store and in-app scheme that will give consumers the ability to pay for goods and services at MCX partners that include Best Buy, Chili’s, Kohl’s and Walmart, among others.
Chase Pay will rely on a QR code, MCX’s preferred technology method, to complete purchases at the physical point of sale, but consumers will also have the ability to make one-click purchases within the CurrentC app. It is not clear at this point which merchants will offer which payment option.
Chase has some 94 million credit, debit and prepaid accounts that will link to Chase Pay, which will work with the majority of Android and iOS devices.
Merchants stand to benefit the most from Chase Pay, though the bank did not give many details about pricing agreements. Chase offers retailers a fixed pricing structure to accept Chase Pay and will not charge for card network fees, merchant processing or merchant fraud liability.
Chase Pay gives a boost to MCX, which has a long, complicated history that dates back to 2012 when a group of merchants led by Best Buy, Target and Walmart first announced the consortium.
In October 2013, MCX announced at this very conference that it was “within a stone’s throw of a pilot,” Jamie Henry, Walmart’s payments guru, said at the time. He told attendees that the participating merchants had an incentive for MCX to succeed since the merchants owned it.
But in a four-week period after Apple Pay debuted in October 2014, things really hit the fan for MCX.
First, MCX members CVS and Rite Aid turned off contactless terminals after the Apple Pay rollout due to an exclusive relationship with a mobile wallet that had yet to debut.
Near the end of October, MCX disclosed that unauthorized third parties had obtained the email addresses for early pilot participants. That day, MCX CEO Dekkers Davidson participated in a bizarre 45-minute teleconference to answer questions from reporters via a chat box. In November during an interview with Bloomberg at Money 2020, Davidson made the surprising statement that MCX is technology-agnostic and could work alongside Apple Pay in its partner stores.
Davidson eventually left the company in April as Brian Mooney stepped into the CEO role. Dekkers’ departure came soon after Best Buy, an original MCX partner, announced it would begin to accept Apple Pay in its U.S. locations this year.
Since Mooney arrived, MCX has taken small steps in an effort to make CurrentC more attractive.
MCX in August announced a strategic relationship with Inmar Inc., which provides promotions management and processing, that will enable CurrentC users to find and redeem product-level digital promotions. These digital promotions will be applied automatically at checkout.
Last month, MCX expanded its CurrentC beta in Columbus, Ohio, and also announced a partnership with Buy It Mobility Networks to enable consumers to quickly and securely connect their checking accounts to the CurrentC mobile wallet app.
This collaboration with Chase Pay is by far MCX’s biggest leap forward to date.
“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 in transactions annually at more than 100,000 U.S. locations,” Mooney said in a statement. “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.”