Ken Myhra
TUKWILA, Wash.—One credit union believes that participating in the new Zelle Network is the next big step for CU person-to-person payments—and for blocking P2P competitors from stealing members.
“Leveraging the Zelle/Fiserv payment rails for P2P allows us to stay in the middle and control member relationships, instead of having them look elsewhere for a P2P solution,” said Ken Myhra, director of retail payments and deposit products at the $15.6-billion BECU, which has signed on with Fiserv and Zelle.
Early Warning launched Zelle and its financial institution-led digital payments network in October. Fiserv is partnering with the company. Together, Fiserv and Early Warning reach more than 6,000 banks and credit unions via the real-time payments network, including the 40 largest financial institutions in the U.S.
Myhra said that members using CU’s P2P solution were starting to expect P2P payments to be completed quickly, based on their experiences with PayPal, Venmo and other P2P players that have sped up their processes. However, before Zelle, BECU’s P2P offering settled transactions in two to four days, typical of many P2P solutions.
Engaged Membership
As one of the first credit unions to offer P2P six years ago, BECU has a membership “engaged” with the service, said Myhra, noting that 40,000 members use the solution.
But having a large number of members engaged with P2P is not typical, analysts have stated, as P2P within credit unions has not caught on—both in terms of member use and credit unions offering the service—due to the lengthy transaction posting time and the service not being simple to use.
Matt Wilcox
Fiserv said Zelle presents credit unions with an opportunity to offer a P2P solution that a lot of members will use.
“With Zelle, the experience is easy and seamless for the consumer. And, most important, the payments are in real time,” said Matt Wilcox, senior vice president, marketing strategy and innovation, Fiserv. “I believe this will jump start P2P within credit unions.”
What Zelle has brought to P2P payments is ubiquity, according to Wilcox.
“I think that banks and credit unions have been waiting for a long time for some ubiquity to be created in the P2P payments network,” said Wilcox. “Now you have one consolidated payment network for P2P. The full use of P2P among credit unions would never materialize without creating some connectivity in the P2P payments network. The large number of financial institutions participating within Zelle, along with real-time payments, will reduce a lot of the friction, or paint points.”
Howie Wu
Better Service
Howie Wu, vice president of digital at BECU, emphasized that the credit union joined the Zelle Network not only provide members with better service and to grow P2P, but to also prevent the Venmos and PayPals from stealing relationships.
“We have roughly about 40,000 P2P users, and we move about $30 million a month within those rails,” said Wu. “The volume is there. We feel that moving to real-time payments, and us thrashing away to change consumer perception that P2P takes days to process, will drive significant adoption. We want our members to know they can now use P2P to pay whoever they want and do it quickly. We want to change their payment habits—stop members from thinking, ‘Can I use P2P to pay for this?’ and get them thinking, ‘Why wouldn’t I use P2P?’”