Several of America’s biggest banks, including the likes of Bank of America and JPMorgan Chase, are joining forces to launch their own digital payment wallet that can be used for online shopping, according to The Wall Street Journal. The planned new wallet is a response to increased consumer usage of digital payments — particularly Apple Pay, PayPal, and ones from other tech companies, including Google Pay and Amazon Pay.
The currently nameless wallet will be handled by Early Warning Services (EWS), the company behind the direct money transfer service Zelle — though the two products will reportedly not intersect. EWS is a bank-owned joint venture between Capital One, PNC, US Bancorp, Truist, Bank of America, and JPMorgan Chase.
The new EWS wallet might work similarly to PayPal, where customers can provide an email address associated with their account during the checkout process at supported merchants. As described, EWS then connects the banks to find eligible cards for the customers.
It’s not clear if this still-in-development wallet by EWS will be easier to use in practice compared to the services it’s meant to compete with. Customers are increasingly getting used to easy and fast checkout processes using services like Apple Pay, which can stack their many different payment cards in one conveniently accessible place.
At launch, Visa and Mastercard will reportedly be on board for the new wallet, and the involved banks are looking to enable 150 million credit / debit cards from customers with up-to-date info and email addresses linked to their cards.
According to folks speaking to the Journal, like the digital wallets from Apple and others, it could help cut down on fraudulent transactions stemming from manual credit / debit card number entries. For the banks, it also maintains their relationship with the customers and merchants and their access to potentially valuable data about the transaction.
Apple is reaching further into the finance business after partnering with Goldman Sachs for its credit card. The company announced it’s adding a new “high-yield Savings account” for customers and is also reportedly expanding its credit services to include a buy now, pay later option that’s expected to be available later this year.
The biggest hurdle for the banks and EWS would be getting vendors to embed yet another checkout service on their sites. But if successful, the big banks and payment networks like Visa could squeeze back some of the cuts tech companies are scraping away from them — especially Apple with its alleged monopoly on tap-to-pay services.