⚠ Everyone Wants This BusinessHigh threat
JPMorgan Chase (JPM) — threat to the moat
The threat is not that a fintech takes the payment; it is that the payment stops passing through a bank account, and takes the funding with it.
Payments is where the disintermediation risk in JPMorgan's filings stops being abstract.
The firm's own competition disclosure lists e-commerce and other internet-based companies, digital asset and financial technology companies among its competitors, and warns that non-financial companies offer products that disintermediate traditional banking services1. In payments that is not a forecast — it is the current structure of the market.
The specific threat is not that a fintech takes the payment. It is that the payment stops passing through a bank account at all, which takes the deposit with it. A treasury balance that moves to a non-bank platform is a balance JPMorgan can no longer fund itself with, and the funding is worth more than the fee.
What protects the position is that large corporates require a regulated counterparty with a central bank account, credit capacity and a balance sheet that will still exist in a crisis. Very few non-banks meet that description, and the ones that do generally partner with a bank rather than replace one.
The falsifier is wholesale operating deposits. If payments revenue grows while those balances fall, the fee has been retained and the funding has not.
- ReportedThe 10-K notes that new competitors continue to emerge, including firms operating solely through the internet and non-financial companies offering products that disintermediate traditional banking products and services.JPMorgan Chase & Co., Form 10-K FY2025 — risk factors and competition (SEC, CIK 19617). 'Competitors include other banks, brokerage firms, investment banking companies, merchant banks, hedge funds, commodity trading companies, private equity firms, insurance companies, mutual fund companies, investment managers, credit card companies, mortgage banking companies, trust companies, securities processing companies, automobile financing companies, leasing companies, e-commerce and other internet-based companies, digital asset and other financial technology companies.' 'New competitors in the financial services industry continue to emerge, including firms that offer products and services solely through the internet and non-financial companies that offer products and services that disintermediate traditional banking products and services offered by financial services firms such as JPMorganChase.' The risk factors further warn that advocacy by non-banking competitors for exemptions from regulatory requirements could significantly disadvantage traditional financial institutions; that if the firm does not keep pace with rapidly changing technological advances, including the adoption of generative AI, it risks losing clients and market share, with competition intensified as the feasibility, capability and scalability of new technologies improves; that adverse macroeconomic or market conditions could prompt outflows from funds or accounts or cause clients to invest in products that generate lower revenue; and that the interconnectivity across credit markets increases the risk that the significant expansion of private credit could worsen losses among non-bank lenders and their borrowers, particularly if stress or defaults spread to broader funding and credit markets. — FY2025 · publ. 2026-02-13 · source ↗