J.P. Morgan and Mastercard Launch Pay-by-Bank via Open Banking

On October 20, 2023, J.P. Morgan and Mastercard jointly launched Pay-by-Bank, a product that enables consumers to pay merchants directly from their bank accounts using open banking infrastructure. The solution leverages Mastercard's open banking capabilities (acquired through Finicity) and J.P.

Morgan's merchant acquiring and payments infrastructure. Pay-by-Bank allows merchants to offer ACH-based payment options alongside traditional card payments, potentially lowering transaction costs. For consumers, the product simplifies bank-account-based payments without requiring manual entry of account details.

The collaboration is notable as it brings together a major card network and the largest U.S. bank to advance account-to-account payment adoption. Financial terms were not disclosed. The launch represents a significant step in embedded payment infrastructure, signaling that open banking-powered payments are becoming mainstream in the U.S. market through partnerships between established financial institutions.