J.P. Morgan and Sephora Extend Tap to Pay on iPhone to Canada

Rhea-AI Summary

Chase Payment Solutions of J.P. Morgan Payments is expanding its Tap to Pay on iPhone service to Canadian merchants. This service allows contactless payments using just an iPhone, with Sephora being the first client to adopt it across 130 stores in Canada. Initially launched in the U.S. in August 2023, the feature enables merchants to accept payments via contactless cards, Apple Pay, and other digital wallets without additional hardware. Max Neukirchen, Co-Head of J.P. Morgan Payments, emphasizes the firm's commitment to modernizing payments to meet consumer demand for fast, convenient transactions. J.P. Morgan Payments processed nearly $10 trillion in daily payments in 2023 and saw a revenue increase to $18.3 billion, up 31% from 2022.

Positive

• Expansion of Tap to Pay on iPhone to Canada increases market reach.
• Sephora's adoption across 130 stores boosts visibility and credibility.
• Service enables seamless contactless payments without additional hardware.
• Tap to Pay supports various payment methods: credit/debit cards, Apple Pay, digital wallets.
• Nearly $10 trillion in daily payments processed by J.P. Morgan Payments.
• 2023 revenue for J.P. Morgan Payments increased by 31% to $18.3 billion.

Negative

• Service rollout is to certain merchants and not available in all markets.
• Some contactless cards may not be accepted by the payment app.
• Transaction limits may apply, potentially causing inconvenience.

Insights

Financial Analyst

The rollout of Tap to Pay on iPhone by J.P. Morgan Payments to Canadian merchants, starting with Sephora, marks a significant development. This move follows the successful implementation in the U.S., indicating J.P. Morgan's commitment to expanding its payment innovations globally.

Revenue Growth: J.P. Morgan Payments reported a 31% increase in revenue from $14 billion in 2022 to $18.3 billion in 2023. This expansion into Canada could further drive revenue growth, especially considering the increasing market demand for seamless, contactless payment solutions.

Market Expansion: The initial partnership with Sephora, a major retailer, is a strategic choice. It not only demonstrates the system's robustness but also sets a precedent that could encourage other retailers to adopt the technology. Expanding this service to small and medium-sized businesses (SMBs) can significantly enhance J.P. Morgan Payments' footprint in the Canadian market.

Long-term Implications: For investors, this expansion shows J.P. Morgan's ongoing efforts to innovate and capture market share in the payments sector. However, the long-term success will hinge on adoption rates by other merchants and consumer reception in Canada. The initial success with Sephora is promising but keeping an eye on broader market adoption will be crucial.

Tech Expert

The Tap to Pay on iPhone technology represents a leap in payment convenience and security. By leveraging the existing capabilities of an iPhone, J.P. Morgan eliminates the need for additional hardware, reducing costs and technical barriers for merchants.

Technological Efficiency: The use of Near Field Communication (NFC) technology allows for quick and secure transactions. This is particularly advantageous in a retail environment where speed and convenience are essential. The fact that no additional hardware is required simplifies the setup process for merchants.

Security Considerations: Contactless payments are generally secure, using encryption to protect transaction data. However, the success of this system will depend on the robustness of the software and its ability to handle various security threats. Continuous software updates and adherence to security best practices will be vital to maintain trust among merchants and consumers.

Consumer Adoption: As more consumers become accustomed to contactless payments, providing multiple payment options (credit, debit, Apple Pay) enhances user convenience. For Sephora’s Beauty Advisors, being able to complete transactions anywhere in the store without additional hardware streamlines the shopping experience.

Market Research Analyst

The introduction of Tap to Pay on iPhone in Canada aligns with broader trends in the payments industry towards more flexible and mobile solutions. The Canadian market is ripe for such innovations, with a high penetration of smartphones and growing consumer preference for contactless payments.

Market Demand: The increasing demand for contactless payment options is driven by consumer preferences for speed and convenience. This trend has been accelerated by the pandemic, which has shifted consumer behavior towards contactless and digital transactions.

Competitive Advantage: By offering Tap to Pay on iPhone, J.P. Morgan is positioning itself ahead of the competition in the payments space. This can attract new merchants looking for innovative and cost-effective payment solutions. Partnering with a high-profile retailer like Sephora further solidifies this competitive edge.

Future Prospects: As this technology is rolled out to more merchants, including SMBs, it could significantly alter the landscape of in-person payments in Canada. Monitoring consumer feedback and adoption rates will provide insights into the long-term success and potential areas for improvement of this technology.

• Chase Payment Solutions, a part of J.P. Morgan Payments, now gives merchants in Canada the ability to more seamlessly accept in-person, contactless payments made using an iPhone
• Sephora to be first client

TORONTO--(BUSINESS WIRE)-- Chase Payment Solutions, part of J.P. Morgan Payments, today announced the expansion of Tap to Pay on iPhone for its merchant clients in Canada. This feature, which allows merchants to accept contactless payments using only an iPhone, was successfully enabled by J.P. Morgan Payments in the U.S. in August 2023. Sephora is the firm’s first client in Canada to enable Tap to Pay on iPhone, which is currently rolling out across more than 130 freestanding stores in the country.

Max Neukirchen, Global Co-Head of J.P. Morgan Payments, said, “When we launched Tap to Pay on iPhone for our U.S. merchants last summer, we were one of the first banks to deliver this convenient and flexible tap-and-go checkout process. Today, we are excited to expand those capabilities to Canadian merchants as we continue to build a modern Payments business. As consumers increasingly demand fast, convenient and frictionless payments, we have a proven track record of innovating at scale to help merchants meet—and exceed—those expectations.”

With Tap to Pay on iPhone, Sephora’s Beauty Advisors can accept contactless credit and debit cards, Apple Pay, and other digital wallets anywhere in the store simply by using their iPhone and Sephora’s proprietary mobile point of sale app – no additional hardware needed.¹ Merchants and their customers can engage and pay anywhere with Wi-Fi or cellular service, resulting in a seamless, end-to-end payment and transaction experience.

“Innovation and the customer shopping journey are key pillars of Sephora’s business and working with J.P. Morgan Payments to deliver Tap to Pay on iPhone is a key example of how Sephora is continuing to provide an elevated experience for our consumers,” said Stefan Jensen, Vice President, Treasurer, Sephora. “After introducing Tap to Pay on iPhone in our U.S. stores last year, our beauty community has really embraced this new way to pay, and we’re thrilled to expand this to our Canadian market. By integrating this flexible payment solution, our Beauty Advisors can provide curated beauty recommendations and complete contactless transactions easily with only an iPhone—wherever they are in the store.”

In the U.S., Sephora complements payment acceptance at existing payment terminals with Tap to Pay on iPhone, ensuring Sephora meets customers where they are and with how they want to pay.

How it works:

Tap to Pay on iPhone provides the ability to accept payments from contactless debit and credit cards and NFC-enabled digital wallets available on smartphones and smart watches.

To facilitate the transaction, the merchant’s employee selects Tap to Pay on iPhone in the mobile point of sale app, and then has the customer tap a contactless card or digital wallet to the employee’s iPhone, completing the seamless payment.

Chase Payment Solutions plans to roll out Tap to Pay on iPhone to additional Canadian merchants, including small and medium-sized businesses. For more information about the solution, click here.

Globally, J.P. Morgan Payments combines treasury services, trade & working capital, card and merchant services capabilities to help clients pay customers or employees, in different currencies, around the world. It processes nearly $10 trillion payments daily, operating in over 160 countries and over 120 currencies. In 2023, J.P. Morgan Payments reported $18.3 billion in revenue across the firm, up from approximately $14 billion in 2022, representing a 31 percent increase, excluding the impact of equity investments.

¹ Tap to Pay on iPhone requires a supported payment app and the latest version of iOS. Update to the latest version by going to Settings > General > Software Update. Tap Download and Install. Some contactless cards may not be accepted by your payment app. Transaction limits may apply. The Contactless Symbol is a trademark owned by and used with permission of EMVCo, LLC. Tap to Pay on iPhone is not available in all markets. View Tap to Pay on iPhone countries and regions (https://developer.apple.com/tap-to-pay/#regions).

About Chase/Chase Payment Solutions

Chase Paymentech Solutions Inc. is a part of J.P. Morgan Payments with headquarters in Toronto, Ontario and is a leader in payment processing for businesses of all sizes. More than 110,000 Canadian business locations trust Chase Payment Solutions with their payments. Choosing Chase Payment Solutions means partnering with a global payments leader that processes more than $2 trillion worldwide in annual debit and credit card volume. Chase Payment Solutions has operated in Canada for more than 20 years, with 200 employees across the country. More information can be found at chase.ca.

About Sephora Americas

Since its debut in North America 25 years ago, Sephora has been a leader in prestige omni-retail with the mission of creating an inviting beauty shopping experience and inspiring fearlessness in our community. With the goal of delivering unbiased shopping support and a personalized experience, Sephora invites customers to discover thousands of products from more than 360 carefully curated brands, explore online and through our mobile app, enjoy services at the Beauty Studio and engage with expertly trained Beauty Advisors in more than 600 stores across the Americas. And with its long-term strategic partnerships with Kohl’s, customers can now shop a fully immersive, premium beauty destination, with over 850 locations nationwide. Clients can access the free-to-join Beauty Insider program and digital community, which together enhance the experience of Sephora’s passionate clients.

Sephora has been an industry-leading champion of diversity, inclusivity, and empowerment, guided by our longstanding company values. In 2019, Sephora announced a new tagline and manifesto, “We Belong to Something Beautiful,” to reinforce its dedication to fostering belonging amongst all clients and employees and to publicly strive for a more inclusive vision for retail in the Americas. Sephora continues to give back to our communities and advance inclusion in our industry through its social impact and equity programming, called the Sephora DE&I Heart Journey.

For more information, visit: https://www.sephora.com/about-us and @Sephora on social media. For media inquiries, please visit our Sephora Newsroom or email ExternalComms@sephora.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240611042990/en/

Media Contacts

J.P. Morgan Payments

Nadine Youssef, nadine.n.youssef@jpmorgan.com

Sephora

ExternalComms@sephora.com

Source: JPMorgan Chase & Co.

FAQ

What is Tap to Pay on iPhone from J.P. Morgan?

Tap to Pay on iPhone is a service that allows merchants to accept contactless payments using just an iPhone, without additional hardware.

When was Tap to Pay on iPhone launched in the U.S.?

Tap to Pay on iPhone was launched in the U.S. in August 2023.

Which company is the first to implement Tap to Pay on iPhone in Canada?

Sephora is the first company to implement Tap to Pay on iPhone in Canada, rolling it out across 130 stores.

What types of payments does Tap to Pay on iPhone support?

Tap to Pay on iPhone supports contactless credit and debit cards, Apple Pay, and other digital wallets.

How much revenue did J.P. Morgan Payments generate in 2023?

J.P. Morgan Payments generated $18.3 billion in revenue in 2023.