JPMorgan Chase is intensifying its efforts to cater to small business customers by planning to introduce digital payroll processing services. The bank has chosen San Francisco-based fintech company Gusto to supply the underlying technology for this offering, according to Gusto CEO Josh Reeves.
This move allows JPMorgan’s customers to access payroll processing from the same platform they use for banking, creating a streamlined experience with unified login credentials. JPMorgan, the largest U.S. bank in terms of assets, has been making substantial investments in technology in recent years, aiming to compete for the loyalty of American retail and business customers in the face of growing competition from fintech firms like PayPal and Square, which offer comprehensive financial solutions, including payroll services.
While JPMorgan has previously introduced fintech features such as a Square-like credit card reader for small businesses and early direct deposit for consumers, it has opted to collaborate with Gusto for payroll services rather than develop its own solution. Payroll services are complex and vary between states, cities, and counties, making it a challenging sector to navigate. Partnering with Gusto will help JPMorgan expedite the launch of this service, set to go live by the end of 2024. The service will handle salary disbursements, generate tax documents and pay stubs, and handle filings with local and national agencies.
JPMorgan serves over 5 million small business customers and has more than 200,000 users of its payment solutions offering. Gusto, founded in 2011, serves around 300,000 small and medium-sized businesses and was most recently valued at $9.6 billion. The company competes with both traditional and newer providers in the payroll services industry, including ADP, Intuit, Paychex, and Rippling.
