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J.P. Morgan launch Open Banking play with “Pay-by-Bank” in US

Consumers are looking for greater choices like mobile payments, crypto wallets, and person-to-person payment apps, which are taking their place alongside staple payment methods like cards and bank-to-bank ACH payments.  

J.P. Morgan launch Open Banking play in US

The latest twist on ACH payments— which account for trillions of dollars of volume each year and continues to grow — is the application of Open Banking technology and makes the process even simpler and more secure. 

Launched by J.P. Morgan Payments and Mastercard, Pay-by-Bank is an ACH payment that uses Open Banking, which enables consumers to permission their financial data to be shared seamlessly between trusted parties to let them pay bills directly from their bank account.

For billers and merchants, it automates consumer onboarding and reduces the risk and cost of storing bank account information.  

Pay-by-Bank holds huge potential for billers to take the pain out of recurring payments such as rent, utilities, payments to government, tuition, insurance, and health care where ACH is the primary medium of payment.  

Billers whose consumers already pay with ACH can choose to integrate the J.P. Morgan Payments Pay-by-Bank solution on their existing payments page.

At checkout, consumers select “Pay-by-Bank,” where they will be prompted to find their bank, verify themselves using their own bank’s familiar authentication process — a biometric scan, for example — and securely share their bank account information with JPMC to complete the payment on behalf of the biller.  

J.P. Morgan Payments and Mastercard are piloting Pay-By-Bank with a small number of US based billers and merchants this year and expect to expand in 2023. 

“Our aim is to stay at the forefront of payments innovation,” says Max Neukirchen, head of Payments & Commerce solutions, J.P. Morgan Payments. “We’re delighted to work with Mastercard on this solution as their Open Banking capabilities will transform the payment experience.

Together, we will offer an attractive, simple and secure Pay-by-Bank solution that gives choice to our clients and their customers who use ACH as their payment mechanism .” 

Pay-by-Bank also uses machine learning in Mastercard’s Smart Payment Decisioning Tools to analyse the best time to initiate the payment based on the bill payer’s historical transaction behaviour and risk patterns, which protects the consumer and merchant by ensuring important payments get made and can reduce the risk of returns due to insufficient balance.  


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