Financial institutions within the Zelle Network rose by 40% in 2022
- Financial institutions that joined the Zelle Network in 2022 increased by 40% compared to the prior year.
- The total transaction volumes and value surged by 26% and 28% respectively.
In 2022, Zelle Network had the number of financial institutions joining its system increase by 40% YoY. Early Warning Services, the owner of the money transfer app, attributes the significant surge to efficient measures and systems geared towards consumer protection and engagement.
Surge in Zelle Network’s transaction volume
Earlier in the week, Early Warning Services stated that the Zelle Network encompasses over 1,800 financial institutions. This includes entities of different sizes. For instance, in 2022, 97% of the institutions that entered the network have assets worth under $10 billion.
According to Early Warning’s CEO, Al Ko, “Banks and credit unions of all sizes are joining the Zelle Network at a rapid pace because it drives higher engagement with their customers and members and enables competitive parity with large banks via the mobile app”.
Indeed, small business senders rose by 66% in 2022 compared to the previous year. The 133 million payments made during this period totaled to over $87 billion. In the same trend, unique small entities such as landscapers, landlords, and house cleaners received over 150 million payments via the Zelle Network in 2022. This represented a 77% surge YoY and equated to an 84% rise to $72 billion.
In total, the value of funds sent in 2022 via the Zelle Network, both by individuals and businesses, was $629 billion. The transaction volumes and value rose by 26% and 28% YoY respectively.
As highlighted in the Curinos Report through a collaboration with Early Warning, the surge in transaction volumes is largely attributed to its focus on consumer engagement and protection. This includes the enacting of efficient measures aimed at protecting consumers from scams and fraud.
The Curinos Report showed that over 99.9% of the payments processed via the network in the first half of 2022 were without any reports of fraudulence. The firm has also noted that the figure improved even more as the year unfolded.
What’s Zelle Network
Zelle Network, previously referred to as clearXchange is a payments network that enables one to send funds swiftly, securely, and easily from their bank account to the recipient’s bank account. The company uses the ACH (Automated Clearing House) payments system to hasten payments between bank accounts within the US.
Ordinarily, initiating an ACH payment may have the transfer completed within three days. Interestingly, with Zelle, the process only takes minutes with no charges.
This money transfer app is owned by Early Warning Services; a private fintech company that offers consumer reporting, identification, payment solutions, and authentication services to financial institutions and governments. Some of the major banks that use its products include JPMorgan, Bank of America, and Wells Fargo.