Early Warning: Zelle Transaction Volume Rose 27% in First Half

The Zelle person-to-person (P2P) payments network continued growing in the first half of the year.

The number of transactions sent via the network increased 27% year-over-year to reach 1.7 billion, while the value of those transactions rose 28% to $481 billion, the network operator of Zelle, Early Warning Services, said in a Thursday (Oct. 17) press release.

In addition, the number of enrolled users of Zelle increased by 17 million to bring the total number of consumer and small business user accounts to 143 million, according to the release.

Early Warning CEO Cameron Fowler attributed this growth to the ease and security of the digital payments enabled by Zelle’s network 2,200 banks and credit unions.

“Simply put, Zelle fills a vital need for millions of Americans,” Fowler said in the release. “Consumers and small businesses alike benefit from the reliability, speed and security that Zelle offers when paying people they know and trust.”

Fifty-one percent of Americans use P2P apps like Zelle and Venmo regularly, according to the PYMNTS Intelligence and The Clearing House collaboration, “P2P Payment Potential: Promoting Convenience While Protecting Consumers.”

While these services have become ubiquitous due to their ability to deliver quick and easy money transfers, concerns about fraud are casting a shadow over their growth, the report found.

JPMorgan Chase disclosed in August that the Consumer Financial Protection Bureau (CFPB) has asked it about the transfers of funds through the Zelle network.

“In connection with this, the CFPB Staff has informed the Firm that it is authorized to pursue a resolution of the inquiries or file an enforcement action,” the bank said in a filing with the Securities and Exchange Commission (SEC). “The Firm is evaluating next steps, including litigation.”

Early Warning said in its Thursday press release that it has been deployed user interface updates, new technology and consumer education to fight scams and fraud on the Zelle platform.

Its efforts include in-app messaging to validate the name of the intended recipient and to remind users to pay only people they know and trust; data-driven insights to help participating financial institutions identify potentially suspicious payments; and campaigns launched in partnership with the Better Business Bureau Institute for Marketplace Trust and the National Council on Aging to help users identify and avoid potential scams and fraud, according to the release.