MCX, the merchant consortium that was going to disrupt the banks’ hold over mobile payments and bring down payment costs for merchants, has finally surrendered—to a bank. JPMorgan Chase announced Friday it has agreed to acquire MCX’s technology, which will be used to bolster its own digital payment solution, Chase Pay. MCX, which launched in 2014, struggled amid leadership changes and fierce competition from device makers like Apple and Samsung, banks (including JPMorgan Chase) and even its own founding members. By Spring 2016, the company had postponed the national rollout of its CurrentC solution, which didn’t allow for consumers to use credit cards in an effort to save merchants the fees associated with payment card acceptance, and was widely considered a failure.
As one of Chase Pay’s early partners, the deal to be absorbed by the issuer makes sense for MCX. From Chase’s perspective, the consortium’s merchant relationships will help extend its reach as it tries to grow Chase Pay.
“When we think about ‘fintech,’ we go through a ‘build/buy/partner’ evaluation to decide how we can get to market most efficiently,” said Jennifer Roberts, head of Chase Pay. “MCX has been an important partner, and their technology complements ours, so we’re thrilled to deepen our relationships with the merchant community through the purchase of this technology. This will help us get to market faster.”
Chase said MCX merchants such including Walmart, Shell, Phillips 66, and Wakefern will enable Chase Pay as a payment option over the next year or more. Chase Pay is accepted in stores at Best Buy and Starbucks and as an online payment method at around a dozen retailers including 1-800-Flowers, Fannie May and Harry & David.
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