JPMorgan Chase is partnering with Marqueta, a Bay Area startup, to launch a virtual credit card to its commercial customers. With the virtual card, corporate customers will be able to use the card immediately through Apple Pay or Samsung Pay without having to wait for a physical card to arrive in the mail.
“Our card tokenization technology powers instant issuance into mobile wallets and can now be integrated with existing card processing capabilities,” said Omri Dahan, Chief Revenue Officer at Marqeta. “This opens up huge new possibilities for companies looking to streamline payments and provide innovative services to their people. To bring this product to a company of J.P. Morgan’s scale and have it utilized in a new way is tremendously validating of its market potential.”
Marqeta estimates that virtual card use translates in a more than $200 billion market, and is projected to grow by 20 percent annually through 2021. More than one billion people are expected to make a payment using a mobile wallet in 2020 as people become increasingly accustomed to this new way to pay, the company says.
CNBC reports that such virtual credit cards are popular in the gig economy where workers might not qualify for a corporate card. John Skinner, head of commercial cards at JPMorgan, told CNBC in a phone interview that with more people working from home during the current health crisis, they might not have access to their offices or work mail where a physical card might arrive. The pandemic has also made digital and contactless payments much more popular, which makes digital cards more attractive.
“Marqeta’s push to wallet functionality will add a new dimension to virtual card payments,” Skinner said in a Marqueta news release. “With Marqeta, our virtual cards can be expanded to new use cases like facilitating payments to disaster relief volunteers or for recruitment spend where interview candidates can be issued a card into their mobile wallets for travel expenses.”