The US Department of Treasury has selected J.P. Morgan to provide account validation services for federal government agencies under a financial agency agreement.
J.P. Morgan has secured the programme for a minimum of five years.
Under the terms of the agreement, J.P. Morgan will validate critical payment information for the federal government prior to the issuance of payments.
By leveraging a broad network of secure customer information and industry data that J.P. Morgan accesses regularly for payment processing, the bank’s cutting edge technology will authenticate details of payments.
According to J.P. Morgan, it already moves more than $9 trillion on average each day.
Besides, the bank said that it has made significant investments in real-time payments as well as in other secure payments technology in recent years.
J.P. Morgan payments global head Takis Georgakopoulos said: “It is an honour to be selected to provide account validation services to the U.S. federal government agencies.
“This is a significant testament to our capabilities and it is particularly gratifying that this work will help to provide money to Americans faster, safer, and more accurately while also saving taxpayer dollars.”
As per the US Government Accountability Office, the federal government reported an estimated $247bn in improper payments during the fiscal year of 2022. This covers overpayments, underpayments, and payments that were made erroneously.
Furthermore, invalid payments because of fraud or clerical mistakes can delay the delivery of critical funds to rightful recipients, result in financial losses, and lower public trust in government services.
In June 2023, J.P. Morgan, through its securities services division, launched sustainable investment data solutions for institutional investors.