“E-wallet”: US banks arm themselves against PayPal

January 27, 2023

Joint digital payment system also to compete with providers such as Apple Pay: The largest banks in the USA want to jointly establish an electronic wallet to take on competitors such as Apple Pay (https://www.apple.com/at/apple-pay/) and PayPal (https://www.paypal.com). The new “e-wallet”, which is being developed by seven US banks – JPMorgan Chase (https://www.jpmorganchase.com/), Bank of America (https://www.bankofamerica.com/), Wells Fargo (https://www.wellsfargo.com/), Capital One (https://www.capitalone.com/), PNC (https://www.pnc.com) and US Bancorp and Truist (https://www.truist.com/)- together with Early Warning Services (https://www.earlywarning.com/), is to enable cashless payments for online transactions and will be launched this year.

Control over payment transactions

“This new electronic wallet is an attempt by banks to regain control of payments currently made through Apple Pay and other similar digital services,” says a report by CNN Business. The importance of achieving this goal from the perspective of the banking institutions can be seen in the fact that all seven of the largest US banks have joined forces for this project.

A cooperation with Early Warning Services should ensure that the project is a success. The fintech company has been operating its own electronic payment system, Zelle (https://www.zellepay.com/), for some time. “The planned new system will be operated independently of Zelle and will also allow users to make online payments. At the moment, Zelle primarily allows transfers between people who know each other,” the report says.

Clear boom on the horizon

The clear upward trend in this sector shows that it could be worthwhile for banks to launch an e-wallet. Early Warning Services, for example, states that consumers will have already made payments of 490 billion dollars (around 451 billion euros) via Zelle in 2021 – this corresponds to an increase of 59 percent compared to the previous year. For PayPal, the traded volume in the same period even amounts to 1.25 trillion dollars. Dollars.

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