America’s largest bank JPMorgan Chase (NYSE: JPM) has bought the remains of the Merchant Customer Exchange (MCX). That includes the technology behind the defunct mobile digital wallet CurrentC.
The MCX was a consortium of big retailers that was trying to develop a quick read (QR) code based alternative to Apple Pay and Android Pay. Its wallet; CurrentC was tested at a number of stores in Columbus, Ohio, including Walmart and Sears last year. It suddenly shut down on June 28, 2016, possibly because Walmart (NYSE: WMT) pulled out and launched its digital wallet – Walmart Pay.
Chase apparently plans to fold Current C into its digital wallet Chase Pay, Business Insider reported. Chase Pay is accepted only at Starbucks and Best Buy right now, but Walmart has plans to start taking it sometime this year. That will give Chase an advantage over Apple Pay and Android Pay, which Walmart refuses to take.
Another advantage that Chase Pay might have is the ability to withdraw cash at Chase banks, ATMs, and retailers. The big problem with Apple Pay is the inability to get cash. Another monster bank; Wells Fargo (NYSE: WFC), is starting to support Apple Pay and Android Pay at its ATMs.
Like Walmart Pay, Current C and Alipay from Ant Financial, Chase Pay uses QR code technology. QR is theoretically more secure and easier to adopt than Near Field Communications (NFC) the wireless technology used by Apple Pay, Android Pay and Samsung Pay. That means it can be used at establishments that were set up for current C.
Chase was involved in the MCX and provided some of its technology. Chase also invested $10 million in LevelUp; a unicorn that has developed a technology that lets customers order and pay ahead which will be added to Chase Pay, Business Insider noted. Combining LevelUp with something like Uber’s delivery service or the UberEats for takeout orders would give Chase an advantage in the payment wars.
Chase’s next big challenge will be the same as Apple Pay. The challenge is how to get retail giants such as Kroger, Costco, CVS, Amazon, Lowe’s and Home Depot to start accepting its digital wallet. That might be a little easier with MCX technology available.