US banking giant JP Morgan has signed a deal with Volkswagen Financial Services to buy a majority stake of close to 75% in the German car company’s digital payments platform.
The bank says the platform is a “natural fit” for its Wholesale Payments business – which combines corporate treasury services, trade finance, card and merchant services – and will expand its digital payment capabilities.
The platform is operated by Volkswagen’s payments arm, Volkswagen Payments, and is currently available in 32 global markets.
It offers a range of digital payments services including the ability to buy and lease cars and pay for fuel, parking and insurance.
JP Morgan will look to invest in the business over the long term with the goal of extending the platform across the broader automotive industry as well as seeking new use cases in other markets and industries.
Shahrokh Moinian, EMEA head of wholesale payments at JP Morgan, says the bank will look to “build on Volkswagen Financial Services’ innovative groundwork on the existing platform” and apply “the global scale of our payments expertise” to further develop the offering.
Volkswagen Financial Services will remain a shareholder and will work with JP Morgan to create customised solutions for its payments network.
The deal is expected to close in the first half of 2022 subject to regulatory approvals. Financial terms were not disclosed.