= Subscriber content; or subscribe now to access all American Banker content.

Bank P-to-P Payments Should Be a Whole Lot Easier

Editor's Note: This post is part of an ongoing series in which customers from different demographics describe what they are looking for from the financial firm they do business with.

Having embraced the digital-banking lifestyle, banks haven't received much face-time from me. From credit card bills to the monthly paycheck, most of my money flows in an automated system that requires almost no effort on my part. And, it's been great. The less I have to deal with the physical aspects of banking, the more I've come to appreciate my banks, JPMorgan Chase and Ally Financial.

But, no matter how streamlined my finances are, there is one thing that has proven to be a regular nuisance. It's the need for a no-cost method of sending money to and from family and friends, without the friction that requires recipients to provide hard-to-remember information like account numbers and routing numbers.

In two recent situations, I struggled to come up with ways to make and receive personal payments from family and friends.

First, a friend who uses Citibank opted to just go to the ATM to get cash for me. I knew he could have used Citibank's person-to-person payments feature (through Popmoney), but I didn't want to deal with signing up for a Popmoney account. This is far too common of an occurrence that prevents more use of P-to-P payments.

Second, I wanted to send money to a family member who uses Bank of America. Just like the above example, the relative didn't want to deal with entering hard-to-find information to collect money through Chase QuickPay, which I would have used to make the transfer.

I recalled that Bank of America and Chase are both founding members of clearXchange, a P-to-P payment network that would allow customers of member banks to send money to each other with just an email address or phone number. According to the FAQs, there is no fee to send or receive money, which is all any consumer can ask for.

With Bank of America and Wells Fargo as founding members, clearXchange would allow me to send and receive money easily through Chase. To my dismay, Chase is not yet capable of providing P-to-P payments through the clearXchange network. Considering this network formed two years ago, I'd expect the service to be available already.

As for the relative's payment, she wrote a check, which I immediately deposited through my smartphone. It's a waste of a check and the process required more effort and resources than an electronic method of sending funds.

The argument for third-party services may be brought into the discussion, but the likes of Google Wallet, Square Cash and PayPal can never earn the amount of consumer trust that exists when someone knows their money is moving between two financial institutions, as opposed to a middleman.

In the next year, I would like to see Chase finally incorporate clearXchange's P-to-P payment services, so that I may continue to bank with more ease. Furthermore, I can see clearXchange's value proposition to become attractive to more banks, especially the nation's largest financial institutions (the network recently added its first nonfounding member bank).

Simon Zhen is a financial writer and research analyst for, a website that features consumer bank reviews, personal finance articles and bank product comparison tables.


(4) Comments



Comments (4)
Check the reviews for ClearX. They are terrible. 3 day wait for transfers. Several people, including myself, were expecting transfers and at the end of the 3 days receive an email saying that the bank account information could not be verified. Transfer was never made. Money took 10 days to get back into sender's account only after then filed complaint with their bank. Do not use this service.
Posted by jfolker1 | Thursday, January 22 2015 at 11:18AM ET
I think the fact that traditional banks have been unable (in many cases) to solve digital banking challenges like P2P payments is well established. The more interesting point (which Kristin has already commented on) is trust. Trust in banks is really the only explanation for why P2P products from PayPal and Square haven't taken off yet. My question is at what point will consumers' desire for better banking products outweigh their desire to work with traditional banks? There has to be a tipping point and it'll be interesting to see what it is.
Posted by Alex Johnson | Monday, January 20 2014 at 3:59PM ET
I recommend Venmo.
Posted by seth22hoskins | Thursday, January 16 2014 at 2:54PM ET
I really like the financial institution "trust" observation and think its one of the industry's great assets, especially as privacy and accountability concerns grow. Wise bankers will leverage that image while meeting demands for e-payments and other products and services.
Posted by Kristen S | Tuesday, January 14 2014 at 11:41AM ET
Add Your Comments:
Not Registered?
You must be registered to post a comment. Click here to register.
Already registered? Log in here
Please note you must now log in with your email address and password.