JPMorgan Chase offers early payday deposits to Secure Banking customers

Sign in front of a Chase bank branch in San Francisco, California, Monday, July 12, 2021.

David Paul Morris | Bloomberg | Getty Pictures

JPMorgan Chase It gives some customers early access to their direct deposits, a feature popularized by fintech competitors as they hope to lure users into a non-overdraft checking account.

According to Ryan MacDonald, Chase’s head of growth financial products, the bank is rolling out this feature to customers of its Secure Banking product starting this week, which accelerates payments such as payroll, tax returns, pensions and government benefits by up to two days. .

That usually means getting paid on Wednesday instead of Friday, he said.

“It’s a few days, usually the difference between asking family for money or not paying that bill on time and being charged late fees,” MacDonald said in an interview. Said.

JPMorgan, the largest U.S. bank by assets, is taking this step as the industry faces increasing pressure from regulators and lawmakers over overdraft and other fees. while smaller competitors including Capital One CEOs of three of the largest US institutions have repeatedly denied calls to end the charges entirely, while saying they are cutting their overdraft fees.

Instead, banks have focused attention on existing products that protect users from overdraft fees while continuing to offer most of the functionality of full-service accounts.

For JPMorgan, this product is Secure Banking, which has no minimum balance requirements and costs $4.95 per month. MacDonald said the service, which targets households earning around $55,000 or less per year, has about 1.4 million users. Most customers have direct deposits and will automatically start receiving early payments, he added.

MacDonald said the bank, which says it serves more than 66 million U.S. households overall, could become a “fast follower” of fintech competitors when they create must-have features. Startups including Chime and Current popularized early direct deposits as they gained millions of cost-conscious users.

“Fintechs are doing a good job of entering the space and trying to disrupt it by providing services,” MacDonald said. Said. “Customers didn’t even consider early access to payment before some of these players arrived. Judging that, we think there’s a real need for certain customers to have it.”

But unlike newer, app-dependent players, JPMorgan’s value proposition includes both digital services and an extensive physical network of approximately 4,700 branches and 16,000 ATMs, the executive said.

The bank added that it is working to offer other solutions for this group, including small loans or installment products, to help users meet their financial needs when emergencies arise.


Leave a Comment

Your email address will not be published.