Mastercard and J.P Morgan’s Pay-By-Bank Brings Open Banking Tech to ACH Payments

Open banking is slowly becoming mainstream as organizations increasingly recognize its benefits. Payments departments will be the latest to experience it as ACH payments become simpler and more secure.

was launched by JP Morgan Payments When master Card, Pay-by-Bank is an ACH payment using Open Banking. It allows consumers to seamlessly share financial data between trusted parties and pay bills directly from their bank accounts with greater security.

You no longer face the tedious task of entering routing and account numbers every time you need to pay your bill. For billers and merchants, it automates consumer onboarding and reduces the risk and cost of storing bank account information.

Pay-by-Bank has great potential to free claimants from recurring payments. Rent, utilities, government payments, tuition, insurance, and health insurance, where ACH is the primary means of payment, can be made easier.

Billers whose consumers already pay with ACH can choose to integrate the JP Morgan Payments Pay-by-Bank solution into their existing payment pages. At checkout, the consumer selects “Pay-by-Bank”. You will then be asked to find a bank and verify yourself using your bank’s familiar authentication process. This could be a biometric scan, for example. Finally, she securely shares her bank account information with JPMC to complete the payment on behalf of the claimant.

Pay by Bank Pilot

JP Morgan Payments and Mastercard are piloting Pay-By-Bank with a small number of US-based billers and merchants this year. They plan to expand in 2023.

“Our goal is to stay at the forefront of payments innovation,” he said. Max neukirchen, Head of Payments and Commerce Solutions at JP Morgan Payments. “Mastercard’s Open Banking capabilities will transform the payment experience and we are delighted to be working with Mastercard on this solution.

“Together we offer an attractive, simple and secure Pay-by-Bank solution, providing choice to our clients and their customers who use ACH as their payment mechanism. It is part of the JP Morgan Payments vision of

“Both billers and consumers will have more payment options,” he said. Ciro eye cutMastercard North America, Executive Vice President, Merchant and Acceptance, said: “But this partnership will also drive innovation in payments, in two ways: the ease of use of the user experience and the security of data sharing.”

“The technology behind Pay-by-Bank reduces the likelihood of fraudulent transactions, relieves clients of the need to hold onto them, and relieves them of the responsibility of keeping consumer banking information secure,” said Neukirchen. says Mr.

Pay-by-Bank also uses machine learning. Mastercard’s smart payment decision-making tool Analyze the best time to initiate payments based on the bill payer’s historical trading behavior and risk patterns. This protects consumers and merchants by ensuring critical payments are made and reduces the risk of returns due to insufficient funds.

Mastercard’s journey in paytech

Pay-by-Bank is another open banking innovation that enables people and businesses to securely share data and access innovative experiences. From new payment methods to secure, frictionless lending, we bring the potential of the digital economy to more people.

Acquired in 2017, Mastercard brought its payments expertise and experience to the world of account-based payments. vocal linkSince then, the company has continued to focus its efforts on increasing the choice of financial services experience and ensuring security. This includes finiteness When Aia.

“We noticed years ago that people’s thinking about money and commerce was changing,” says Aikat. “They want to pay and get paid how, where, and when they want. With this new partnership with JPMorgan Chase and an enhanced payment experience, I’m excited about the opportunity to empower people.”

Industry reaction

After receiving this news, Hiroki Takeuchico-founder and CEO go card dressSaid:

“This announcement is further confirmation that direct bank payments are the way forward. faster payment rail than a credit card.

“Around the world, advances in open banking are transforming the speed, ease of use and security of banking payments, putting them in par with, and often superior to, cards in a wide variety of use cases. The fact that JP Morgan and Mastercard have entered the space proves what we have been doing for over a decade and shows that large-scale adoption is imminent.”

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