TUKWILA, Wash.-P2P payments are popping at BECU here, giving the credit union a foothold in the emerging mobile payments market.
"P2P is the first step into mobile payments and wallets because it's a means to get people to think about electronic payments being convenient and mobile-driven," said Howie Wu, VP-virtual banking at the $10-billion CU.
"The market leader in person-to-person payments could become the winner in the mobile payments space," he continued. "Members will keep you top-of-mind, especially if you're the first financial institution to offer P2P in your area."
Fewer than 3% of BECU's active online bankers are making P2P payments, but nearly 40% of new members are enrolling in the service-indicating that usage could quickly pick up, Wu said. The number of users is up more than 100% over last year.
Among active P2P payers, there's "tremendous" usage-47% of users complete at least three transactions in three months, Wu added.
BECU moves $6.5-million per month via the P2P channel, which is transmitted as an ACH payment by Fiserv's Popmoney P2P electronic payment product, he said. The average BECU P2P transaction is a remarkable $559, and volume is up 110% over last year.
Popmoney makes it "easy and comfortable" for BECU members to use the service-and relatively simple for people without Popmoney to receive the funds, Wu added. BECU members can pay any person by directing funds from their BECU account to the person's mobile phone number, email address or account routing number.
How The Process Works
When the payee receives a text or e-mail notification of the transfer, the payee accepts the automatic transfer into the account. Of course, the payee first registers their bank account information with Popmoney.
Popmoney P2P payments are processed in about two days and are free to both sender and receiver. BECU charges $2 for overnight payments to recoup costs, said Wu.
After the Popmoney network merges with the ZashPay P2P network, Popmoney will be the largest and only "relevant" bank P2P payments network in the country, suggested Neil Platt, SVP and general manager of payments, CashEdge Division, Fiserv. P2P will attract more attention when BECU offers it through the mobile platform later this year-currently, P2P is available online only, said Wu. "P2P and mobile are synergistic."
That's because "mobile banking becomes very compelling and very useful when you can use it to make payments" to people, according to Platt. "As a result, I use mobile banking and mobile payments more."
The P2P payments market is growing quickly, Platt continued. "Two years ago, no one was offering P2P. Today, 5,000 financial institutions are registered as senders and receivers across the country."
BECU is surprised by the way members use Popmoney, Wu suggested. Although BECU promotes P2P for casual payments-a way to "reimburse-a-friend-for-the-restaurant-check"-BECU members are embracing P2P for formal payments.
"We've got a lot of members using P2P as a way to electronically pay rent to landlords, rather than coming in to get a cashier's check from us"-which also relieves BECU of the burden of high-cost cashier-check transactions, Wu explained.
That's in line with what other FIs are seeing, said Platt. "People are using it to replace checks, not cash."
For Info: MORE@CUJOURNAL.COM BECU Popmoney Registered Users by Month
BECUwww.becu.org Fiservwww.fiserv.com Subscribers can find related stories at www.cujournal.com and searching the following the headlines:Fiserv Combines P2P's Popmoney, ZashPay-March 1, 2012Threat From PayPal, Other P2P Providers, Underestimated By Many-August 22, 2011
