For those who have wondered if the banking industry's Zelle, a product that lets consumers make payments to one another using their smartphones, could ever compete with PayPal’s popular Venmo product, Bank of America on Friday shared numbers that suggest maybe it can.
The bank said it processed nearly 68 million Zelle transactions in 2017, an 84% increase from the previous year. In the fourth quarter, Bank of America handled more than 23 million Zelle transactions, totaling nearly $7 billion, up 91% from the fourth quarter of 2016.
Bank of America is one of the seven banks that own Early Warning Services, the company behind Zelle, and (in early 2017) was one of the first to incorporate it into its mobile banking app.
It lets consumers send, receive and request money, allowing them to use the existing contacts on their mobile device. Funds are sent from one bank account to another typically within minutes when both parties are enrolled, using only a recipient’s email address or mobile number.
The bank says it has nearly 3 million active Zelle users and that it is adding thousands more every day.
PayPal’s Venmo service is also in growth mode. The company processed $9.4 billion of Venmo transactions in the third quarter (the latest period for which statistics are available), a 93% increase over the year before. Venmo has an estimated 10 million users.
The Zelle bank network as a whole processed $17.5 billion of payments in the third quarter that were tied to 60 million transactions.