In order to compete with Apple Pay and PayPal, major US banks have developed their own digital wallets.
What do you have in your digital wallet? It should be one of the main banks in the United States.
According to The Wall Street Journal, Wells Fargo, Bank of America, JPMorgan Chase, and four other institutions will soon provide a digital wallet. Even though some of these financial organizations have literally been in the business for centuries, they are currently running frightened while attempting to compete with services like Apple Pay, PayPal, and Venmo.
Why digitalize?
Safety and ease. Like the old American Express commercials, many today rarely leave home without their phone, yet having a wallet and phone may be awkward. Digital wallets accelerate internet purchases. Similar to wallets, phones can be stolen, although digital wallets frequently provide additional security measures like facial recognition. They’re also secure, so even if your favorite coffee shop is hacked, attackers won’t get your data. But, not all stores accept electronic payments, so save $20 in your wallet or handbag for emergencies. Don’t say.
Early Warning Services, which manages Zelle, a limited-bank-account money transfer platform, would operate the nameless digital wallet. Visa and Mastercard are on board and it will launch in the second half of the year, according to WSJ insiders.
JPMorgan CEO Jamie Dimon predicted the fintech industry’s death, stating banks “should be scared s—less” of Paypal and Square. So, the digital wallet is the latest bank move to compete with Silicon Valley:
- Apple, Google, and Amazon already have loyal customers, so convincing them to use digital wallets is easy. Ernst & Young reported that 64% of the world used a fintech app in 2019, and the digital banking market is estimated to reach $10.3 trillion by 2028.
- CB Insights reported that fintech digital loan capital fell 53% to $11.5 billion in 2022. Traditional banks suffered more. World banking funding plummeted 63%.
Beating competitors is fun, but buying them is easy. Traditional banks have invested considerably in fintech startups that potentially threaten them in recent years. JP Morgan bought Renovite in September. Truist bought Long Game, a gamified bank, last spring to attract younger customers. Fintech valuations decreased in November, allowing banks to buy companies for their tech and digital payment departments, according to Reuters.
