Another player jumped into the market for speedier payments Monday as San Francisco-based clearXchange launched a product that will allow users to make real-time person-to-person, business-to-consumer and government-to-consumer payments using only mobile phone numbers and email addresses.
Five of the six largest banks in the United States and several regional financial institutions have already provided 100 million online banking consumers with access to the clearXchange network through their online banking platforms, the company said in a release. Anyone with a U.S. bank account can access the company's services through its website, it said.
“As people and businesses increasingly transition everyday activities from traditional to online channels, they expect things to be completed faster,” clearXchange CEO Mike Kennedy said. “This includes financial transactions, particularly those with a need for real-time funds availability such as sending emergency money to kids, paying rent at the last minute or receiving funds for an accident claim or disaster relief.”
More than 50% of clearXchange-enabled transactions are already completed in real-time when customers transfer money within the same bank, and the new technology will enable real-time transfers from bank-to-bank, it said.
The news comes on the heels of MasterCard's launch of its own real-time payments system and NACHA's recent move to offer real-time payments. MasterCard's product, MasterCard Send, allows customers to send funds in real-time to other bank accounts, mobile wallets and cash agent outlets, as well as MasterCard and non-MasterCard cards. NACHA plans to add two new same-day settlement windows to the ACH network, increasing the movement of funds between financial institutions from once a day to three times per day. The rule also requires all receiving depository financial institutions to accept same-day transactions.
ClearXchange, founded in 2011, said it acts as a secure gatekeeper that enables users to associate a piece of public information – a mobile number or email address – to a piece of private information, such as bank account data. The actual transfer of funds occurs between the sender's bank and the receiver's bank. Only checking and savings accounts at U.S. banks work with the system, according to the company's FAQs.
Member banks include Bank of America, CapitalOne, Chase, FirstBank, USBank and Wells Fargo, but membership is open to banks and credit unions of all sizes, the company said. Look for member financial institutions to roll out the real-time offering to customers and members over the next year, clearXchange said.
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