JPMorgan eyes cash services boost with first Asia fintech investment

Bloomberg

JPMorgan Chase & Co.’s first investment in an Asian financial technology firm is a key plank in the US bank’s strategy to boost its cash management services in fast-growing regional markets such as India and China, according to a senior regional executive.
Last month, JPMorgan announced it was taking a stake in Global PayEx, a Mumbai-based fintech firm which helps companies manage their invoicing and payments.
The purchase reflects the importance of technology investment in achieving the bank’s ambitions in transaction banking, said Kalpana Morparia, JPMorgan’s chairman for South and Southeast Asia.
“Transaction banking is a key focus for JPMorgan as a whole, and technology is the key differentiator there,” Morparia said in a recent interv-iew. The US lender may use Global PayEx’s electronic invoicing in other emerging markets, and is open to the idea of further fintech investments to bolster its cash management services for corporate clients, Morparia added.
JPMorgan earmarked $11.5 billion for technology investments in 2019 with machine learning, artificial intelligence and blockchain identified as priorities, according to its annual report. Its return on equity from cash management — the business of helping multinational companies manage their liquidity and a key component of transaction banking — was 20 percent last year,
exceeding the 15 percent return from the corporate and investment bank.
“The biggest play in Asia is really China, followed by India, in terms of the size of the economy and the number of clients that we wish to serve there,” Morparia said. “So we are constantly looking for anything that we can do for them to make it far easier for them to operate.”