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By Renaming clearXchange, Early Warning Hopes Zelle Will Be the Belle of the P2P Ball

By John Stewart

The big banks that run clearXchange are getting around to slapping a brand name on the peer-to-peer payments network, five years after founding it. The new name is going to be Zelle, confirms a spokesperson for Early Warning Services LLC, the Scottsdale, Ariz.-based fraud-management company that acquired clearXchange last year. The spokesperson tells Digital Transactions News the brand will not appear commercially until some time in the first half of 2017.

“For now, clearXchange will continue to operate as an independent service and will be available for ongoing payments for any U.S. consumer with a checking account,” says the spokesperson. In the meantime, Early Warning has set up a preliminary Web site for Zelle.

The new name is intended to connote speed, agility, and elegance, the spokesperson says.

Seven major financial institutions own Early Warning, including Bank of America Corp., BB&T Bank, Capital One Financial Corp., JPMorgan Chase & Co., PNC Bank, U.S. Bancorp, and Wells Fargo & Co. BofA, Chase, and Wells started clearXchange in 2011 and added real-time payments last year.

The value of a widely known, one- or two-syllable brand name for a P2P network that mainly serves consumers may have hit home with the stunning success of Venmo. The mobile service owned by PayPal Holdings Inc. has been racking up year-over-year volume increases well in excess of 100% and has recently begun processing in-app merchant payments in a service called “Pay With Venmo.” The name is so entrenched with Millennial users, the service’s chief market, that it has become a verb, as in “I’ll Venmo the money to you later today.”

“’Venmo’ doesn’t mean anything, but the marketing and promotional approach behind it has been very successful and it is now synonymous with a P2P transaction,” Sarah Grotta, director of the debit advisory service at Maynard, Mass.-based research firm Mercator Advisory Group, tells Digital Transactions News.

Whether Early Warning can achieve similar results with Zelle remains to be seen, but one sticking point might lie in the names some banks have already introduced for their own branded P2P services, including names for services that leverage clearXchange. Chase, for example, calls its service QuickPay. A Chase spokesperson refused to comment on the bank’s plans for the name.

Such proprietary brands may ultimately have to yield to the one common name, Grotta argues. “There are advantages to all Early Warning platform users to use the same Zelle branding as consumers will immediately understand that they can then transact with someone else who is also a Zelle user,” she says. “Today, a Chase QuickPay user can send money to a Wells Fargo customer, but they may not realize they have that option without the common branding.”

Zelle will be building on a not inconsiderable base of users. As of the time of the acquisition by Early Warning, clearXchange had more than 20 million registered users from more than 7,500 financial institutions. It had direct relationships with eight member banks, which collectively represented 60% of mobile-banking customers, while the remaining clearXchange users accessed the network via

Adding to the network’s potential usage are new links to MasterCard Inc. and Visa Inc., which earlier this month agreed to allow debit card holders to make P2P payments via clearXchange.

Meanwhile, the opportunity for electronic and mobile penetration of P2P payments remains big. In 2014, the two methods accounted for half of all P2P transaction volume and 51% of P2P spending volume in the U.S. according to Aite Group, a Boston-based research firm, From each household, that activity generated 26 transactions annually worth $5,447.

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