JPMorgan is shutting down its Chase Pay app2 min read . Updated: 21 Aug 2019, 07:50 PM IST
The company started informing customers Wednesday that they’ll no longer be able to use the product to pay
JPMorgan Chase & Co. is planning to shut down its Chase Pay app in the bank’s third reversal on digital offerings in three months.
The company started informing customers Wednesday that they’ll no longer be able to use the product to pay with their smartphones when shopping in stores starting early next year, according to an email seen by Bloomberg. They’ll still be able to use Chase Pay on the websites and apps of retailers that accept it.
It’s an about-face on a product introduced four years ago to compete with rivals such as Apple Inc. that are working to transform how consumers pay for products and services. New technologies have spurred a revolution in mobile payments, with Chinese companies leading the way in helping consumers bypass credit and debit cards. The U.S. market has been slower to develop.
“When we started this, it was four years ago -- the payment space has changed a lot over the period of time and customer behavior has changed," Eric Connolly, head of Chase Pay, said in an interview. “A lot of merchants have shifted to ‘buy online, pick up in store’ and have invested in their online presence and their apps."
The bank says it wants to capture a larger share of a market long dominated by PayPal Holdings Inc., whose digital wallet was accepted by about 70% of online merchants at the end of the second quarter. Fewer than 1% accepted JPMorgan’s, according to a study by industry publication PYMNTS.com.
Pablo Rodriguez, a JPMorgan spokesman, declined to say how many online retailers currently accept Chase Pay, adding that the bank expects that number to increase. In a statement on Wednesday, the company said that GrubHub Inc. will soon accept it.
Shares of the bank, which have climbed 11% this year, advanced 0.8% to $108.16 at 9:33 a.m. in New York.
Finn, On Deck
JPMorgan has shown a greater willingness than rivals to cut bait on unsuccessful projects as it spends more than $11 billion on technology initiatives designed in part to position the bank to stay ahead of changes in how consumers spend money.
Some of the bank’s other digital experiments have failed to take hold. In June, it shut down digital bank Finn a year after rolling out the brand nationally. A month later, it cut ties with fintech company On Deck, whose technology platform it had used to originate online small-business loans.
JPMorgan has been testing other technologies to lure consumers to spend more on its cards. It has been adding tap-to-pay technology to its cards and joined with Cardlytics Inc. to offer coupons for select merchants inside its mobile app. In February, it unveiled a prototype cryptocurrency, dubbed JPM Coin, that it plans to use to speed up payments between companies.
This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.