JPMorgan Chase has made several investments in financial technology startups, but its plan to buy WePay will give its 4 million small-business clients a much more direct way to adopt digital payments.
The bank announced plans to acquire the payment company on Tuesday in a deal that could be larger than $220 million, according to The Wall Street Journal, which attributed the amount to unnamed sources.The parties would not confirm the amount of the deal.
"With WePay, Chase is taking the work out of payments for both our business clients and the software providers who serve them," said Matt Kane, CEO of Chase Merchant Services, in a release. "We are powering payments for growth, so businesses can accept payments instantly, get paid faster, and never lose a sale. And we’ll give ISVs a payment facilitator-like experience without the overhead or increased fraud risk."
WePay serves primarily smaller businesses and communities that sell products online on behalf of micromerchants. It has bulked up considerably in the past year, adding support for Apple Pay and Android Pay for mobile checkout and introducing offline services to ward off competition from mobile point of sale providers such as Square.
"We think this is a game-changer — we’re combining the global brand, scale, capabilities and distribution of one of the world’s largest and most respected financial institutions with our world-class talent and technology to build the future of FinTech," said Bill Clerico, founder and CEO of WePay, in an email.
For JPMorgan Chase, it's a substantial commitment to its fintech investment strategy. There have been 166 fintech payment deals totaling at least $29.3 billion in 2017, the Journal reported, citing numbers from Financial Technology Partners. This makes payments the largest segment for fintech investment.
JPMorgan has not been a major part of that deal making. The bank has made some investments, including a relatively small $10 million stake in LevelUp, participated in a $100 million investment in Bill.com, and invested in MCX's mobile payments technology to bolster Chase Pay. WePay would be its first major fintech acquisition.