JP Morgan – Pioneering Open Banking Transformation through Blockchain and Machine Learning

On their blog JP Morgan explains how Open Banking Enables the Digital Economy, what they describe as the Open Banking Transformation.

In this video Sairam Rangachari asks how can the bank better connect to an ecosystem to provide enhanced value to customers. He explains the industry acronyms like APIs and PSD2, and how they are intended to tackle the disjointed nature of the digital user experience.

He highlights the implementation of key technologies such as Identity authentication and that users themselves are in control over how data is shared, and how it will enable better automation of traditional back-end processes like reconciliation. Their ongoing roadmap is based around a central principle of continually enhancing their customers experience.

 

To get started customers should approach JP Morgan with a forward leading vision such as ‘treasury of the future’ and where they want that to lead, and fostering a collaborative technology innovation process with them. On his Medium blog Norbert Gehrke walks through a case study of this scenario.

In this video Bruce King-Shey and Christine Moy sets the scene by saying the business world is experiencing a ‘data revolution’, and are utilizing data science and technologies like Blockchain to build innovative new solutions to client needs.

This includes releasing a virtual assistant for their Access platform and building a Blockchain-based peer to peer network of correspondent banks to exchange sanctions screening information, the ‘Interbank Information Network‘. These types of enhancements have optimized client service team processes from days and weeks, to minutes.

Preparing for the Next Generation of Consumer Banking

In this video Stephen Markwell provides an introductory explanation to APIs and then how JP Morgan is using them.

This includes launching the JP Developer and the Chase Developer portals and ecosystems, where they are educating and supporting customers to utilize their APIs and build innovative new services atop them. For example it can be integrated into an e-commerce shopping cart for a new checkout option, achieved very easily through a simple code snippet.

They have selected partners such as Plaid to help them build out these ecosystems.

CB Insights offer this excellent in-depth analysis of the JPM digital strategy, with key highlights including:

• JPM’s digital push, a theme it refers to as “Mobile First, Digital Everything,” is showing positive early results. In Q2’18 JPM had about 48M active digital customers, while top competitor Bank of America had 36M. JPM’s mobile active users also showed strong growth in Q2’18, jumping 12% YoY.
• A huge investment into skills recruitment. Their career website had 2,314 open technology jobs, 148 product manager roles, and 63 digital jobs. This is in addition to the already 50,000 people working in technology at JPM, including more than 31,000 in development and engineering jobs and 2,500+ in digital roles.
• This also includes ingesting skills via acquisition, notably their $300M+ acquisition of online payments service provider WePay.
• JPM offers a host of mobile apps, amassing nearly 32M active mobile customers. Chase Mobile is the bank’s most popular app, and essentially acts as a digital branch for customers. The app allows users to make deposits, make payments, and keep tabs on their account (through paperless statements and account alerts), and will soon add You Invest, the bank’s brokerage platform.
• Finn is JPM’s mobile-only bank, and represents JPM’s attempt to jump on the mobile-only banking trend before it becomes the norm. The emoji-filled app was released nationwide this year.
• ChasePay is the bank’s digital wallet. The app uses QR-codes, which are scanned at POS by barcode readers (so no new hardware is required for merchants). Payments through the app can only be funded by Chase products: credit cards, debit card, or prepaid card.
• Since 2012, JPM has applied for 120 patents related to “payment systems” (of those, it has so far been granted 63). It has also been granted 19 patents related to “debit cards,” 13 for “mobile payments,” 14 for “credit cards,” and 9 for “contactless smart cards.”