A Financial Times report said JPMorgan Chase has applied for a US patent for a computerized payment system that is similar to the Bitcoin. Citing the patent application, the report said the lender's proposed system would enable customers to make electronic payments online without the need to identify their names, give account numbers or pay a fee. The patent application also said that the new system would provide competition to debit and credit cards as a leading method of making payments online.
The report said JPMorgan's application highlighted the battle going on behind the scenes among the biggest banks, credit card issuers and technology firms like Google, Apple and PayPal. The firms are intent on getting a slice of the fast-growing business of proving mobile and internet payment platforms as more people do their shopping online. Meanwhile, traditional finance firms also have to contend with new kinds of virtual currencies which are already viewed by some people as alternative payment systems that could challenge credit cards and lenders, the report said.
However, the Financial Times said some look at JPMorgan's payment system as getting features from the controversial Bitcoin. The system reminds one of computer files holding Bitcoins for users because it would involve the creation of "virtual cash" placed in an online wallet, the report said. Like the Bitcoin "blockchain" that serves as the ledger for all transactions in the digital currency, JPMorgan's payment system would also have a public record of transactions made in the system.
The bank did not specifically name the Bitcoin or other virtual currencies in its filing but it did say there were "emerging efforts" to test the supremacy of credit card technology, the report said. In its application, JPMorgan said, "While new internet payment mechanisms have been rapidly emerging, consumers and merchants have been happily conducting a growing volume of commerce using basic credit card functionality. None of the emerging efforts to date have gotten more than a toehold in the market place and momentum continues to build in favour of credit cards."
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