clearXchange

clearXchange, also known as Zelle, is a U.S.-based digital payments network owned by Early Warning[1] that enables U.S. individuals and businesses to electronically transfer money from their bank account to another person's bank account using a web interface or mobile device.[2][3] Unlike when using an Automated Clearing House (ACH) transfer, the payer does not need to know the bank account information of the payee to make a payment. Instead, that information is held by the clearXchange service, and the payer only needs to know the email address or phone number of the payee as a way to uniquely identify the recipient. To receive payments, the payee must register their bank account with clearXchange and associate it with their email address or phone number.

Also unlike an ACH transfer, the service only allows transactions initiated by the payer, not the payee. Once initiated, a payment cannot be canceled.[4] The service's web site says that "Your recipient will generally receive the funds within 5 business days".[4]

Before it was sold to Early Warning in January 2016,[1] clearXchange was owned by a group of banks consisting of Bank of America, Capital One, JPMorgan Chase, US Bank, and Wells Fargo.[5][6]

clearXchange was reported to have been rebranded as "Zelle" in August 2016, although the service has also continued to operate using the clearXchange name. A mobile app called Zelle was released in June 2017, and the new Zelle service provides much faster money transfers than what was previously offered by clearXchange. Transactions between accounts at financial institutions that participate in the "Zelle Network" are typically completed within minutes.

History

clearXchange was formed by Bank of America, Chase, and Wells Fargo in 2011.[7] The service was designed to improve upon banks' existing person-to-person payment services by simplifying the money transfer process.[3] It enables direct account-to-account transfers that avoid the need to first move money into a separate account.[3] In 2013, clearXchange named Mike Kennedy Chief Executive Officer[8] and FirstBank as a member.[9] In 2014, it announced Capital One as an additional owner and member.[10] In 2015, clearXchange announced US Bank as an additional owner and member.[11][12]

As of March 2015, clearXchange was the largest bank-focused person-to-person payment network in the U.S.[12]

In October 2015, clearXchange was acquired by Early Warning risk management service.[13]

In August 2016, clearXchange was reported to have been rebranded as "Zelle", but it continued to operate as clearXchange.[14][15] Until early June 2017 when a pop-up announcement and page header were added saying "clearXchange is becoming Zelle!", there was no mention of Zelle on the clearXchange official website.

In June 2017, a mobile app was released using the "Zelle" name.[16] The website about Zelle says that users should register at the clearXchange website in order to use the Zelle mobile app.[16]

Service

clearXchange enables users to send money to anyone with a United States bank account. Users access the network within the websites and apps of member financial institutions,[7] and through clearXchange's website. The network connects with existing bank accounts, so consumers do not need to fund a separate account to use the service.[17] Only the recipient's email address or mobile number is needed to send money directly from bank account to bank account.[3]

clearXchange offers person-to-person (P2P), business-to-consumer (B2C), and government-to-consumer (G2C) payments.[18]

In 2015, clearXchange announced the availability of a real-time payment system.[19][20] However, as of June 2017, the clearXchange FAQ says that transactions may take as much as five days or longer and that no faster method is offered:[21]

In contrast, the newer website about the Zelle mobile app that was launched in June 2017 says that "Transactions made between financial institutions in the Zelle Network typically complete within minutes. If your recipient does not have access to Zelle through their bank or credit union, transactions could take between 1 and 3 days to complete."[16]

Participants

As of June 2017, Zelle is available through the various participating banks' apps and websites, and for consumers whose banks do not participate, Zelle is available by registering an email address or phone number on the clearXchange website.[22][23]

The Zelle Network includes the following participants:[24]

References

  1. 1 2 "Early Warning Completes Acquisition of clearXchange". clearXchange. Retrieved 2017-01-27.
  2. ↑ Sidel, Robin (May 25, 2011). "Big Banks Join Battle for Online Payments". Wall Street Journal. Retrieved 1 August 2015.
  3. 1 2 3 4 Bernard, Tara Siegel (May 25, 2011). "Person-to-Person Payments Get Easier at Big Banks". New York Times. Retrieved 29 July 2015.
  4. 1 2 "FAQs". clearXchange official web site. Retrieved 27 January 2017.
  5. ↑ "US Bank Latest Owner-Member of clearXchange". PYMNTS.com. March 17, 2015. Retrieved 1 August 2015.
  6. ↑ "clearXchange rolls out real-time payments". PYMNTS.com. June 15, 2015. Retrieved 1 August 2015.
  7. 1 2 Smith, Aaron (May 25, 2011). "New cash transfer service rivals PayPal". CNN Money. Retrieved 29 July 2015.
  8. ↑ Adams, John (September 10, 2013). "ClearXchange Names Wells Fargo's Michael Kennedy as CEO". Payments Source. Retrieved 29 July 2015.
  9. ↑ Adams, John (October 10, 2013). "ClearXchange Bank P2P Network Adds FirstBank". Payments Source. Retrieved 4 August 2015.
  10. ↑ Bhattarai, Abha (March 9, 2014). "Capital One to begin offering peer-to-peer money transfers via email, mobile phone,". Washington Post. Retrieved 28 July 2015.
  11. ↑ Woodward, Kevin (March 17, 2015). "The clearXchange P2P Payment Services Adds U.S. Bank as an Owner and User". Digital Transactions. Retrieved 29 July 2015.
  12. 1 2 "U.S. Bank Latest Owner-Member of ClearXchange.". PYMNTS.com. March 17, 2015.
  13. ↑ Adams, John; Heun, David (October 26, 2015). "Banks Keep the Reins By Merging ClearXchange, Early Warning". Payments Source. Retrieved 10 March 2016.
  14. ↑ Stewart, John (August 25, 2016). "By Renaming clearXchange, Early Warning Hopes Zelle Will Be the Belle of the P2P Ball". Digital Transactions. Retrieved 27 January 2017.
  15. ↑ Sidel, Robin (August 24, 2016). "America's Biggest Banks Have a New Name for Their Venmo-Killer: Zelle". Wall Street Journal. Retrieved 27 January 2017.
  16. 1 2 3 "Zelle official website". Retrieved June 11, 2017.
  17. ↑ Salmon, Felix (May 25, 2011). "Why clearXchange is great for payments". Reuters. Retrieved 29 July 2015.
  18. ↑ Heun, David (July 15, 2015). "clearXchange: We Have the Answer to Real-Time Payments,". Payments Source. Retrieved 29 July 2015.
  19. ↑ Bakker, Evan (Jun 21, 2015). "Here's What Happened in Payments this Week". Business Insider. Retrieved 29 July 2015.
  20. ↑ Heun, David (June 15, 2015). "Bank Consortium clearXchange Debuts Real-Time Payments". American Banker. Retrieved 29 July 2015.
  21. ↑ "FAQ". clearXchange. Archived from the original on June 6, 2017. Retrieved June 13, 2017.
  22. ↑ Cowley, Stacy (June 12, 2017). "Cash Faces a New Challenger in Zelle, a Mobile Banking Service". Deal Book. NY Times.
  23. ↑ Perez, Sarah (June 12, 2017). "Zelle the Real-Time Venmo Competitor Backed by Over 30 US Banks Arrives this Month". Tech Crunch.
  24. ↑ "Partners". Zelle. Retrieved June 13, 2017.
This article is issued from Wikipedia. The text is licensed under Creative Commons - Attribution - Sharealike. Additional terms may apply for the media files.