J.P. Morgan Chase & Co started piloting a real-time payments service with an undisclosed FinTech company last week, which company officials hope will give them an edge in the global digital payments race.
The service — called request for pay — allows J.P. Morgan corporate clients to send payment requests to the 57 million retail users of its app or website, as Cyrus Bhathawalla, global head of real-time payments, told Reuters.
The company sees the service as ideal for gas-distributing companies to allow faster payments when they fill a gas station’s supply tanks, he said. That could cut payment time from about a week to less than 30 seconds.
Takis Georgakopoulos, global head of wholesale payments at J.P. Morgan, told PYMNTS earlier this year that there’s been a sense of urgency from clients to move to a digital environment since the COVID-19 outbreak began in the spring of 2020.
“This is not just about treasury departments trying to make money movements more efficient,” he said in the January 2021 interview. “It’s about digitizing how the whole business operates.”
PYMNTS explored the frictions involved in cross-border payments and the real-time solutions being leveraged to simplify and streamline these processing delays in this month’s Real-Time Payments Tracker®.
High costs, slow processing speeds and high error rates are the biggest complaints among business leaders about the current cross-border payment system. Seventy-one percent of those surveyed pointed to error rates of up to 6 percent, processing times of up to five days and transaction costs of anywhere from $30 to $100 as issues for their companies. Blockchain technology can increase speed and reduce costs by cutting out middlemen, the report said.