As the move toward virtual financial transactions grows, J.P. Morgan is eliminating plastic from some of its credit cards.
The global financial services company headquartered in New York has joined with Marqeta Inc. to issue virtual cards, the Oakland, California-based digital card-issuing platform announced Tuesday (July 28).
The partnership allows instant issuance of virtual cards into mobile wallets for payment options including Apple Pay or Samsung Pay for J.P. Morgan’s commercial card clients.
“Our card tokenization technology powers instant issuance into mobile wallets and can now be integrated with existing card processing capabilities,” said Marqeta Chief Revenue Officer Omri Dahan in a statement. “This opens up huge new possibilities for companies looking to streamline payments and provide innovative services to their people.”
The function is expected to debut next year and will integrate with J.P. Morgan’s systems.
In addition to J.P. Morgan, Marqeta said it has contracts with on-demand delivery platforms, including Instacart, DoorDash, Postmates and Uber Eats.
Virtual card use is a more than $200 billion market, projected to grow by 20 percent annually through 2021, Marqeta said. The company said more than 1 billion people are expected to make a payment using a mobile wallet in 2020 as consumers and businesses become more comfortable with this new way to pay.
“Marqeta’s push to wallet functionality will add a new dimension to virtual card payments” said John Skinner, head of commercial card at J.P. Morgan, in a statement. “With Marqeta, our virtual cards can be expanded to new use cases like facilitating payments to disaster relief volunteers or for recruitment spend where interview candidates can be issued a card into their mobile wallets for travel expenses.”
In Powering the Digital Shift 2020 this month, PYMNTS reported an increasing number of banks are favoring virtual cards that feed directly into mobile wallets, putting an end to plastic.
“The additional controls and authentication measures that mobile wallets can deliver are crucial for businesses that administer funds to thousands of employees,” said Simon Barker, CEO at Conferma Pay.
The majority of digital wallets, however, are still enabled by traditional plastic cards. But when a mobile wallet acts as the proxy for a card, and a card just represents 16 digits linked to a specific account, PYMNTS asked: Why is a plastic card needed at all?