Zelle Network Finishes Strong in 2018
The growing popularity of mobile payment features could be good news for credit unions.
Payments network Zelle announced this week that it processed $35 billion in payments and over 135 million transactions during the fourth quarter of 2018, marking all-time highs for the network owned by Scottsdale, Ariz-based Early Warning. Year-over-year payment value for the fourth quarter increased by 61%, while transaction volume increased by 81%, it said.
The surge brought Zelle’s activity for the year to $119 billion in payments and 433 million transactions.
At the end of 2018, 229 financial institutions were part of the Zelle network; 60 of those financial institutions were live and processing transactions, the company said. Eighty-five percent of participants in the Zelle Network were regional and community banks or credit unions with assets of $10 billion or less, it noted; 77% had less than $1 billion in assets.
“Our strategic processor partners are helping move Zelle closer to its goal of nationwide ubiquity – signing more than a hundred banks and credit unions in Q4 alone,” Early Warning CEO Paul Finch added. “Already, customers of more than 5,100 financial institutions are using the Zelle Network, whether it’s through their financial institution’s mobile banking app, or by registering their debit cards in the Zelle mobile app.”
The growth highlights other recent trends in adoption of P2P technology among consumers.
Person-to-person payments have surged by 250%, according to Malauzai Software’s last annual App Store Research report, for example. However, that report also stated that not all payment services were catching on yet.
“But where the hell is Zelle/?” it asked at the time. “It’s nonexistent in terms of the numbers. More than 1,000 financial institutions offer P2P within their banking app. Only 20 or so offer Zelle; everyone else offers standard bank-centric P2P.”
Nonetheless, in a different survey done by S&P Global Market Intelligence last year, more than a quarter of U.S. mobile bank app users age 18 or older said person-to-person payments were one of the most important features available in their apps. Fewer than 17% of participants said the same in the prior year. The growing popularity of mobile payment features could be good news for credit unions and other financial institutions eager to keep up with fintech firms and other digital disruptors, that study said.