The investment shows the growing interest in vehicles as digital wallets for purchases
JPMorgan will buy a stake of close to 75% in Volkswagen’s payments business.
While financial terms of the deal were not disclosed, mid-year sales at VW's financial services division (including payments) were $26.77bn, an increase of 18 percent over 2020.
Volkswagen's digital payments arm was established in Luxembourg in 2017. It lets customers buy and lease cars and pay for parking tickets and electric vehicle charging.
What does this mean?
The connected car space — where vehicles becomes digital wallets for purchases — is growing fast. This deal helps JP Morgan expand its digital payment capabilities and enter into the automotive industry for the first time. Over time, the plan is to expand Volkswagen’s payment platform to cover markets outside the automotive sector.