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BofA, Chase And Wells Fargo Unveil New P2P Payments Network
Three of the nation's big four banks have developed a person-to-person payment service that'll allow customers to send money via mobile number or email address.
The project, dubbed clearXchange, is a joint venture between Charlotte, N.C.-based Bank of America, San Francisco-based Wells Fargo and New York-Based JPMorgan Chase. It enables the three banks' customers to make payments from their checking account to anyone with an account at one of those three banks. Chase, Wells Fargo and BofA said clearXchange will roll out nationally, and that the plan is to ultimately bring other financial institutions into the network.
It is the first bank-owned solution of its kind.
"This is an innovative game-changer in electronic payments," said Mike Kennedy, EVP and Head of Payments Strategy at Wells Fargo. "We want our customers to be able to easily send money to anyone without having to establish a new account outside their primary bank. All our customers need to know is the email address or mobile number of a friend or family member and we will take care of the rest utilizing clearXchange."
Bank of America's John Feldman will serve as general manager of clearXchange, which is headquartered in Charlotte.
"Our goal is to provide convenient and safe financial services options for our customers," said David Owen, eCommerce, Claims and Fraud Executive at Bank of America. "By creating a utility like clearXchange, we are able to meet the needs of our customers and differentiate our capabilities from other offerings in the marketplace."
Email addresses or mobile numbers will be used instead of routing and checking account numbers. The banks didn't indicate how payments will be initiated, whether through online banking or through mobile banking services as well.
"clearXchange will allow us to make our popular person to person payments service even better," said Jack Stephenson, Director of Mobile, eCommerce and Payments at JPMorgan Chase. "Chase customers will be able to send and receive money even more quickly and easily — with full confidence their funds are in a bank account without worrying about cash, checks or higher-cost services."
The project, dubbed clearXchange, is a joint venture between Charlotte, N.C.-based Bank of America, San Francisco-based Wells Fargo and New York-Based JPMorgan Chase. It enables the three banks' customers to make payments from their checking account to anyone with an account at one of those three banks. Chase, Wells Fargo and BofA said clearXchange will roll out nationally, and that the plan is to ultimately bring other financial institutions into the network.
It is the first bank-owned solution of its kind.
"This is an innovative game-changer in electronic payments," said Mike Kennedy, EVP and Head of Payments Strategy at Wells Fargo. "We want our customers to be able to easily send money to anyone without having to establish a new account outside their primary bank. All our customers need to know is the email address or mobile number of a friend or family member and we will take care of the rest utilizing clearXchange."
Bank of America's John Feldman will serve as general manager of clearXchange, which is headquartered in Charlotte.
"Our goal is to provide convenient and safe financial services options for our customers," said David Owen, eCommerce, Claims and Fraud Executive at Bank of America. "By creating a utility like clearXchange, we are able to meet the needs of our customers and differentiate our capabilities from other offerings in the marketplace."
Email addresses or mobile numbers will be used instead of routing and checking account numbers. The banks didn't indicate how payments will be initiated, whether through online banking or through mobile banking services as well.
"clearXchange will allow us to make our popular person to person payments service even better," said Jack Stephenson, Director of Mobile, eCommerce and Payments at JPMorgan Chase. "Chase customers will be able to send and receive money even more quickly and easily — with full confidence their funds are in a bank account without worrying about cash, checks or higher-cost services."
http://www.banktech.com/payments-cards/229625564
July 2010 - P2P Payments Will Fail Without Changes
There’s a lot of momentum behind Person-to-Person (P2P) payments in the U.S. JP Morgan Chase is the most recent, but PayPal, Fiserv, CashEdge, Obopay, and others are signing banks and trying to get consumers to enroll and use the service. The networks must interconnect if banks want the new payment revenue.
P2P promises the ability to pay anyone electronically essentially as a check or cash replacement. Mobile is the ideal platform for P2P since we’re usually not at our desk when we need to pay someone. With P2P, users can send (or request) money to others using just an email address or mobile phone number.
P2P also offers a strong ROI for institutions. Handling cash and checks is expensive. Theft and fraud are real costs of doing business when dealing with cash and checks. Yet banks can’t charge for cash and checks. P2P can reduce the number of cash and check transactions while generating new revenue from expedited payments.
Current P2P offerings generally allow free transfers for 3-5 day clearing, offering an opportunity for banks to generate float revenue. Users can choose expedited (next day) clearing for a fee. Banks make more money in both cases because the transaction is making new money while costing less. That’s a good business model. It’s certainly better than free checking.
The problem is that P2P offerings aren’t connected. There’s no way for a Fiserv customer to pay a PayPal customer. They system is missing what Jim Kittridge at Wachovia a few years ago called “The Big Directory in the Sky.”
read more July 2010 http://blog.mobilestrategypartners.com/2010/07/20/p2p-payments-will-fail-without-changes/
http://clearxchange.com/
