Small Businesses and Consumers Complete 639 Million Transactions on Zelle in Q1

Consumers’ and businesses’ use of Zelle increased about 30% year over year in the first quarter.

The number of transactions completed using the peer-to-peer (P2P) payment service rose 29% to 639 million and the amount of money sent grew 31% to $180 billion, Early Warning CEO Albert Ko said in a Monday (April 17) post on LinkedIn. Consumers and small businesses also completed 639 million transactions, a 29% increase year-over-year.

“It’s clear that our user base for Zelle is growing and ever-more engaged, and we are committed to continuing to bring trust to the financial moments that matter to them through strong fraud prevention and robust regulatory oversight and compliance,” Ko said in the post.

The increase in use of Zelle was helped by the growing number of financial institutions that are on the Zelle Network. That number topped 1,900 during the first quarter, with credit unions accounting for almost half of the financial institutions that went live on the network during the quarter, according to the post.

“Zelle allows banks and credit unions of all sizes to compete on equal footing with larger financial institutions,” Ko said in the post.

The rate of Zelle payments sent without report of fraud or scams — which stands at better than 99.9% of the payments sent since Zelle’s launch in 2017 — continued to improve in the first quarter, according to the post.

Ko attributed this to each institution in the network being required to use tools and procedures to mitigate fraud and scams; their compliance being monitored closely; and the network continuously addressing the changing tactics deployed by fraudsters.

“As part of our work to fight these tactics, we have increased network-level controls to prevent bad actors from transacting on the Zelle Network and reducing their run-time on the network,” Ko said in the post. “We routinely block high-risk enrollments from registering on the network and we diligently work to identify bad actors and remove them by restricting all tokens registered and blocking them from future enrollments.”

This report comes as Early Warning — which is owned by a group of banks including JPMorgan Chase, Wells Fargo and Bank of America — is expected to pilot a new digital wallet called Paze starting this summer.