Bank service

JP Morgan and Mastercard launch “Pay-by-Bank” service

By Gloria Methri


  • ACH
  • Instant payment
  • JP Morgan

As traditional payment methods such as cash and personal checks continue to decline, JP Morgan Payments seeks to capitalize on growing consumer interest in alternative payment methods by partnering with Mastercard on a new digital banking payment platform.

MasterCard announced that it has partnered with JP Morgan Payments to develop “Pay-by-Bank”, an Automated Clearing House (ACH) open banking payment platform, which allows consumers to pay their bills directly from their account banking instead of a card.

This means that customers no longer need to enter account numbers each time they need to pay an invoice. For billers and merchants, it automates consumer onboarding and reduces the risk and cost of storing bank account information.

JP Morgan says the offer will be particularly beneficial for recurring payments such as rent, utilities, government payments, tuition, insurance and healthcare where ACH is the primary means of payment.

The two companies have agreed to begin rolling out Pay-by-Bank with a small number of US-based billers and merchants this year, with hopes of expanding the platform further in 2023.

Max Neukirchen, Head of Payments and Commerce Solutions, JP Morgan Payments said, “We are excited to work with Mastercard on this solution, as their open banking capabilities will transform the payment experience. Together we will deliver an attractive, simple and secure Pay-by-Bank solution that gives choice to our customers and their customers who use ACH as a payment mechanism.

“The technology behind Pay-by-Bank reduces the likelihood of unauthorized transactions and frees our customers from the need to store – and the responsibility to store – consumer banking information securely,” Neukirchen added.

Chiro Aikat, Executive Vice President of Merchants and Acceptance, Mastercard North America said of Pay-by-Bank, “Both billers and consumers benefit from greater payment choice, but the partnership also drives payments innovation on two fronts – in ease of experience user and in the security of data sharing”.

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