JPMorgan announced that it’s acquiring cloud-native payments startup Renovite. The California-based startup will become part of JPMorgan Payments.

Why should we care?
Most analyses of the acquisition frame the Renovite purchase as a response to fintechs like Stripe and Block, which have taken larger chunks of the payments space through modern tech that enables speedier and more intuitive onboarding experiences. JPMorgan processes more than $9 trillion per day across different businesses, but its merchant acquiring revenue decelerated last year because of competition in the e-commerce space. According to Global Head of Payments Takis Georgakopoulos, JPMorgan is consciously investing and acquiring fintechs to gain a competitive edge in that domain. But, in addition to this news being about a deepening competition between JPMorgan and scrappier fintechs, the acquisition also symbolizes JPMorgan’s growing commitment to competing with itself—daring its more cumbersome corporate structure to modernize and design more innovative products, or risk stalling and losing out to challengers. By hiring a startup engineering team that’s proved its worth, JPMorgan can both build out its payments infrastructure, while also designing a more holistic engineering culture internally, which may bleed into other parts of its business as well.