Duffy Led Chase Paymentech Through Industry and Ownership Changes

Mike Duffy, president and chief executive of JPMorgan Chase & Co.’s Chase Paymentech merchant-acquiring subsidiary and one of the acquiring industry’s most prominent figures, died Thursday after a long illness.

“It is difficult to put into words how much Mike will be missed,” said Gordon Smith, chief executive of Chase Consumer and Community Banking, in an e-mail to Chase employees. “He was a brilliant leader, pioneer in the payment industry and fierce competitor. Most importantly, I was proud to call him my friend. His passion and tenacity was exemplified in so many aspects of his life, from his battles against personal illness to how he led his team and established Paymentech as a global industry leader.”

Chase did not disclose details of Duffy’s medical problems, apart to say that he entered a hospital last weekend and died surrounded by his family.

The banking giant named Dan Charron, executive president of client services under Duffy, as acting head of Dallas-based Chase Paymentech. As the nation’s No. 2 merchant processor, Chase Paymentech handled $655.2 billion in charge volume last year, up 18% from 2011’s volume, and 29.5 billion transactions, up 21%.

Duffy, 54, worked in the payments industry for more than 25 years, including 13 leading Paymentech. Earlier he was the chief financial officer of Litle & Co., a pioneering card-not-present processor. What was then First USA Paymentech bought Litle in 1995, an acquisition that vaulted Paymentech to the front ranks of catalog and then Internet payments.

What today is Chase Paymentech has had various names and owners and co-owners over its corporate history that began back in 1985 when it was founded by Texas-based MBank. Others included Lomas, First USA, Bank One, First Data and finally Chase. The Paymentech brand debuted in 1996 when the company executed an IPO.

Duffy, who had served as chief financial officer, chief operating officer and president of Paymentech, became chief executive in 2005 when Paymentech integrated with Chase Merchant Services, a Chase-First Data joint venture. That venture ended in 2008, with Chase and First Data splitting what was then the nation’s largest acquirer more or less in half. Duffy and the Paymentech name went with Chase.

“Mike was both extremely passionate and entirely grounded,” Kevin G. Jones, a seven-year Paymentech veteran who is now president of SignaPay, an Irving, Texas-based independent sales organization, tells Digital Transactions News by e-mail. “Most every one of his employees knew him, and had a personal relationship with him. Mike’s real legacy is not just that he led Chase Paymentech to unmatched heights, but that he was a role model that inspired so many industry leaders to follow in his footsteps and lead with integrity, innovation, vision and true concern for the people around them.”

Pamela H. Patsley, the former chief executive of First USA Paymentech who is now chairman and CEO of MoneyGram International Inc., said in statement that “Mike was an incredible leader in the financial-services industry. He had a passion and vision that inspired all, but his family was first and foremost for him. He was my friend and I will miss him.”

Paymentech had a reputation of being a payments innovator even before Duffy took the reins. One of his more recent moves was teaming up with the high-profile and fast-growing but controversial mobile-payments processor Square Inc.

C. Marc Abbey, who works closely with acquirer clients as managing partner of First Annapolis Consulting Inc., says Duffy “was one of the most effective executives in acquiring. He built one of the deepest management teams in the business and together they turned Paymentech into a force. Mike understood the business at a level of detail that can be uncommon in the executive suite … he inspired a great deal of personal loyalty from his colleagues and was just a good guy.”

Jason Oxman, chief executive of the Electronic Transactions Association, the national acquiring industry trade group, issued a statement saying, “The payments industry has lost one of its true luminaries with the death of Mike Duffy. For more than 20 years, his passionate leadership of Chase Paymentech brought new technology and innovation to our industry while bringing merchants and their customers amazing new benefits.”