Digital P2P services aren’t new in the U.S. Sending funds to friends and family has been a core feature of PayPal for most of its existence, and is the biggest draw of its subsidiary Venmo. JPMorgan Chase for some time has offered its own QuickPay P2P service. Chase is also a founding member of Zelle, and has renamed its service Chase QuickPay with Zelle.
The move seems to have been successful. Chase executives last month told investors that after Zelle launched, the bank saw a 48% increase in P2P transactions during 2017 over the previous year, with transaction volume rising to 143 million from 96 million. Chase said the greatest increase within the bump in P2P transactions was in payments between Chase customers and other banks, not just among Chase customers.
Similarly, Bank of America — another founding member of Zelle — said in January that 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.
But that growth may be thwarted by Zelle's aggressive anti-fraud efforts. Zelle allows consumers to use its app even if they are not a customer of a Zelle bank, as long as the recipients of any transfers use a Zelle bank. But in recent months, many consumers have complained that Zelle would not approve their accounts for enrollment. According to Early Warning, the bank collective that operates Zelle, this "friction point" can arise when it suspects a user is enrolling a bank account that has been compromised by fraud.