Several banks are reportedly working on a digital wallet that links with debit and credit cards, in a bid to compete with Apple Pay and PayPal.
According to The Wall Street Journal, the digital wallet would be operated by Early Warning Services, a joint venture from several banks that also runs Zelle. The major banks involved include Wells Fargo, JPMorgan Chase and Bank of America, according to the report.
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Early Warning Services confirmed to CNBC that it plans to launch a wallet product this year.
The move could be seen as an effort to slow Apple's push into consumer banking, as the tech giant already offers a branded credit card and is exploring other products for their famously loyal customer base.
Shares of PayPal, which has digital payments as its core business, ticked up 0.5% on Monday after initially falling more than 2%.
Bernstein analyst Harshita Rawat said in a note to clients on Monday that the major banks have "likely always had PayPal envy" but that it would take time for the new wallet to be a serious risk to incumbents.
"It simply takes a very long time, a killer customer experience (which needs to be better than incumbents, not just similar), and a compelling merchant value proposition to build the two-sided network effects in payments to achieve scale," Rawat said in the note.
The report follows a mixed earnings season for big banks, with several CEOs, including Bank of America's Brian Moynihan, warning that the U.S. is likely to see a mild recession. Bank stocks have struggled over the past year even as interest rates have risen, as fears of a recession and a slower investment banking environment have offset gains in net interest income.
Read the full Journal story here.
— CNBC's Michael Bloom contributed to this report.