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APY GUY: Maximize Your Savings & Earnings

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Kevin Flynn

Popmoney Review – How it Works and How it Compares

Kevin Flynn
December 16, 2020

Popmoney is a payment service that allows people to send, request and receive money directly from their bank account. The service makes peer-to-peer transfers as simple as sending an email or text.

As a background, Peer-to-peer transfers are electronic money payments made from one person to another through an intermediary payment application.

These came on the scene in a major way with the birth of eCommerce and the need to facilitate payments between customers and sellers – most notably with online retailer eBay.

PayPal, which was later acquired by eBay in 2002, was the first mover in the space and certainly not the last. This acquisition and the growth of eCommerce in general spurred a boom in both online P2P transactions and competing applications facilitating them.

Today, there are dozens of peer-to-peer (P2P) payment apps out there to choose from.

And although Popmoney is not a first-mover nor a flashy up-and-comer, they are one of the largest in terms of institutional banking partners and wide-spread usage.

Developed by CashEdge in 2010 and now owned by Fiserv, Popmoney has gone through a series of changes in the past decade.

Let’s start with CashEdge. The brand name was absorbed when they were acquired by Fiserv, but I personally still have nightmares about using their data aggregation software back in my financial advisor days. Even their primary partner, Albridge, abandoned them in the end. 

That’s not to say that Popmoney provides a bad experience because they were developed by CashEdge, but I went into this review with a bit of a bias just as a matter of full disclosure.

A History of Partnerships and Integrations

Fintech applications are built to be sold. It’s the reason that financial software companies exist. They build a product, market it for a while to grow a client base, then sell for as high a valuation as possible. That has happened several times over with Popmoney.

The first acquisition is the most obvious and it has nothing to do with P2P applications. Fiserv bought CashEdge in 2011 to compete with data aggregation rival ByAllAccounts, which has since been sold to Morningstar. This gave them Popmoney, but that was not their target.

The move did prove beneficial, though. Popmoney was connected to a number of larger banking institutions, so they melded it with their existing P2P provider, called Zashpay, which already connected to 1,400 banks. The combined entity stayed under the Popmoney brand.

If you’re wondering about the name, it stands for “Pay other people money.” That’s pretty direct and could have benefitted from the services of a clever marketing firm, but that never really developed. Fiserv has always treated P2P as secondary to their aggregation services.

On April 17, 2013, Fiserv announced the launch of a new “Instant Payments” feature in their Popmoney application, placing them in a space that had been dominated by Paypal for decades. Venmo was still in their formative years and Zelle had not been launched yet.  

The Basics – How Popmoney and Other Electronic Transfers Fundamentally Work

To understand how Popmoney works, the first step is to go over what an electronic funds transfer (EFT) is. The concept goes back to 1870, when Wells Fargo first started sending money using their telegraph lines. The Federal Reserve Bank adopted the practice in 1910. 

In 1972, the need for batch transactions led to the development of the automated clearing house (ACH), which is how most commercial bank wire transfers are done today. This is how P2P applications like Popmoney move cash. 

Unlike Paypal or Venmo, the money moved through Popmoney has to be in the sender’s bank account before the ACH can be initiated. The payment can then be made by sending to the recipient’s email address or mobile phone number. 

The application is designed for person-to-person transfers, but Popmoney also offers commercial accounts. The commercial account is advertised as a “full featured” electronic invoicing platform but it’s debatable as to whether or not they live up to that name.

Essentially, it’s a stripped-down basic service that doesn’t even provide any type of reporting or accounting. You can set recurring invoices, but you have to export them to Excel to run transaction reports.

As for the personal P2P app, I downloaded it from the App Store for my iPhone and found it to be pretty bare bones as far as features go. That’s not necessarily a bad thing, since all you really want to do is send and receive money, but I was expecting more from a ten-year-old app.

Processing Time for Sending and Receiving Payments

Having run small businesses for nearly three decades, my experience has been that an ACH should take no more than forty-eight hours to show up in your bank account. Popmoney takes up to three business days.

For the quickest transfer of funds, the sender must submit a payment via his/her debit card by 5:00pm PST and the recipient must accept it by 10:00pm that same night. In this instance, funds will take just 1 business day to transfer.

If you need to transfer money instantly, you might want to try another application.

A deeper dive into customer reviews show a number of complaints on the wait time as well, and even several instances where funds seemed to have been “frozen” after transfer, getting lost in limbo for a period of time before they could be sorted out.

The app itself scores just 1.5 stars out of 5 on the IOS App Store and just 2.3 stars out of 5 on Google Play with a significant portion of the 1 star ratings citing the slow transfer time. As of the time of this writing 484 individuals have reviewed the app for IOS and 1,328 for Android.

Of course, Popmoney is not alone in this. I’ve seen similar issues with Zelle and even worse with Paypal, who regularly freezes money for “security” checks. Venmo, which is owned by Paypal, does not appear to have this problem according to publicly available, consumer reviews.

Cost breakdown

Here’s an area where Popmoney performs better.

They charge a flat 95 cents per money transfer, unlike Venmo and Paypal, both of which charge a percentage. Zelle, on the other hand, charges nothing, so they win this battle.

Your bank may charge a fee for ACH transfers, so check into that before using Popmoney. Banks and credit unions within the Popmoney network could have better rates or may not charge you extra at all. I searched through Popmoney’s website for more on this, but it’s not there. 

That said, 95 cents is not a bad price, particularly since there doesn’t seem to be a limit on how much you can send.

Popmoney Fees vs Other P2P Apps

AppFee
Cash AppFree, 1.5% or 3% of the sum*
Facebook MessengerFree
Google Pay SendFree
PayPalFree or 2.9% + $0.30 fixed**
Popmoney$0.95 per transfer
Venmo3% of sum but can be waived***
ZelleFree

*The Cashapp charges the sender a 3% fee to send a payment using a credit card and 1.5% for an instant deposit to a bank account.

**Sending funds via a PayPal balance or linked bank account is free. Sending funds via a credit card, debit card or PayPal credit will cost you 2.9% of the amount plus a fixed fee of $0.30.

***Venmo waves this fee if transfer is funded via a Venmo balance, a bank account, or a debit card.

Availability – Which Institutions Use It?

There’s a search function on the website where you can look up your bank to see if they do business with Popmoney. Zashpay already connected to 1,400 institutions before they merged with Popmoney so these institutions remain on the list. The major ones include the following:

  • Ally Bank
  • TD Bank
  • Fifth Third Bank
  • Regions Bank
  • US Bank
  • Bank of America
  • Citibank
  • PNC Bank, NA
  • SunTrust Bank
  • Wells Fargo Bank

Is it Safe?

Popmoney is legitimate, so there are security safeguards in place.

Popmoney sends a one-time verification code (usually six digits) to the mobile number or email address of the payment sender to thwart unauthorized payments and theft. The user then needs to confirm that code to verify they own that cell number or email address to continue.

Unfortunately, any time you use an email to send or receive money there’s always the possibility of fraud. That email message from a “friend” could be someone looking to steal your money so whenever you receive a request for money be sure to verify the sender’s email or phone number.

Another drawback to Popmoney is there’s no buyer protection if you use it for a purchase. That’s not really what it’s intended for, but there are scenarios where the seller may not want to take credit cards. Be careful in those situations. It could be a scam.

Don’t use Popmoney for online auctions. Whenever you’re buying something “as is” you have very little recourse to begin with. Add in the lack of buyer protection and you’re just asking for your money to be stolen. Use a regular credit card, not a debit card, instead.

What Personal Information is Shared with the Service?

You do have to share your bank tracking and routing numbers with Popmoney, but the recipient of any payments you make has no access to that information. This gives you a level of privacy that writing a check does not.

If you send money to someone who doesn’t have a bank account at a Popmoney affiliated financial institution, they will need to provide their tracking and routing numbers to retrieve the funds. Make that clear to anyone you’re planning on sending a payment to. 

Make sure that you’re using the real Popmoney website or mobile app when you enter bank account information. There are a few fraudulent sites out there that disguise themselves as being the legitimate website. Double check the URL at the top of the page to confirm.

PopMoney vs. Competitors

Zelle is the main competitor to Popmoney and lately they’ve been winning the battle. Venmo is considered more of an app for young people making smaller cash transfers, but their subscriber numbers are higher due to affiliations with Paypal and eBay.

Other competitors include Paypal, Google Pay Send, and Facebook Messenger. I’ve compared fees, network size, payment types, speed, and safety features below. 

Popmoney vs Zelle

Zelle doesn’t charge a fee to send money. That’s great, but their network (100+ banks) is significantly smaller than Popmoney (over 2500). Like Popmoney, you can send money via email or mobile number, but they also have the option of using your credit card. 

Zelle is faster. You don’t have to wait several business days for the transaction to complete. It happens in minutes for in-network users. Recipients outside the network receive their funds within 72 hours. From a security perspective, the two apps are roughly the same. 

Popmoney vs Paypal

The fees for Paypal are a little more complex. It’s free to send money using your bank account, but instant transfers are 25 cents. Credit card transfers are 2.9% plus 30 cents per transaction. The upside is that Paypal’s network is the largest in the world.

Regular Paypal money transfers take roughly the same amount of time that Popmoney transfers do. Instant transfers are available within thirty minutes. Security is much better, with buyer and fraud protection available for all accounts. 

Popmoney vs Venmo

Venmo is owned by Paypal, but for users it’s a very different experience. It’s easy to set up and you can transfer money with a bank account or debit card for free. Credit card transfers will cost you 3%. Instant transfers are 25 cents and money is available within 30 minutes. 

Venmo is only available for users with a US bank account. Regular transfers take one to three business days. They do not offer buyer or seller protection, so if you’re buying merchandise or bidding at an auction, use a credit card or Paypal.  

Popmoney vs Google Pay Send

Formerly known as Google Wallet, Google Pay Send charges no fees to send money and you can use it anywhere that Google Pay is accepted. You can link a debit or credit card and instant transfers happen in a matter of minutes. Bank account transfers take three days.

Google Pay Send has the best security on this list. They offer 100% fraud protection for unauthorized transactions, but if you send money voluntarily to someone who’s scamming you it may not be covered, so make sure you know who the recipient is. 

Popmoney vs Facebook Messenger

Did you know that you can send and receive money using Facebook Messenger? If you add a credit or debit card to your account, you can conceivably send money to any of the more than one billion people who use Facebook every day. There are no fees to do it. 

The drawbacks to Facebook Messenger are speed and network limitations. Payments can take up to five days to show up and Facebook has a policy that you’re only allowed to transfer money between family and friends. If you use it for business, they will shut you down. 

Final Thoughts

Depending on how you use Popmoney and what your expectations are with the application, you may come away satisfied or dissatisfied with your experience. The user interface is fairly lackluster and unimpressive for an app that has had more than a decade to evolve and the time it takes to send and receive funds is quite slow compared to other available options.

That said, the flat fee structure and widespread adoption among major financial institutions allow it to satisfy many customers’ needs.

Filed Under: checking accounts Tagged With: Popmoney

TotalDirectBank Money Market – 0.50% APY + 0.50% APY CDs

Kevin Flynn
November 24, 2020

image credit: totaldirectbank.com

Total Direct Bank is a division of City National Bank of Florida – an institution with over $15 billion in assets and a “superior” 5-star rating from Bauer Financial for 24 consecutive quarters.

City National Bank has gone through a series of mergers and acquisitions throughout its ~70 year history in Florida, but its most recent M&A activity stems from the financial crisis of 2008.

In 2008 Caja Madrid purchased City National Bank, giving it international reach. In 2012, the Spanish bank then had to sell off its assets due to financial hardships. After a short period of uncertainty, Banco de Credito e Inversiones acquired City National Bank for $946.9 million in 2015. That transaction laid the groundwork for the move to direct banking.    

On December 1, 2017, City National Bank, infused with new capital from the Banco de Credito acquisition, purchased TotalBank for $528 million. The merger of the two Florida powerhouses made them the third largest bank in the state and paved the way for the launch of Total Direct Bank a year later.

Total Direct Bank has become a solid play in the online banking space, regularly featuring respectable yields on their deposit products that handily beat the current national average(s).

Like many online-only banks, Total Direct Bank, has a simple set of FDIC-insured products. They have a variable rate high yield money market account as well fixed-rate, standard term CDs. We will cover their deposit products in this review.

TotalDirectBank Money Market Rate + Account Details

Total Direct Bank has a competitive money market account that currently features a good rate if you can deposit and maintain an average monthly balance of $2,500.

BalanceMin DepositAPY
$2,500$2,5000.50%

Total Direct Bank allows for unlimited deposits and transfers from an external bank, but only six withdrawals per month per Federal Regulation D.

There are no maintenance fees but you will need to maintain an average daily balance of $2,500 to earn the advertised APY.

There are some geographical limitations. TDB does not do business in Florida, Puerto Rico, or the US Virgin Islands. Valid state issued ID or US passport is required for account opening.

TotalDirectBank CD Rates + Account Details

Total Direct Bank’s certificate of deposit suite offers less enticing rates than their money market account, with an extremely steep minimum deposit requirement of $25,000.

In general, online-only banks tend to have lower minimum deposit requirements on their FDIC-insured deposit products. For example, banks like Marcus by Goldman Sachs or Vio Bank only require $500 to open any of their CDs.

TotalDirectBank CD Rates

CD TermAPY
3 months0.50%
6 months0.50%
12 months0.50%
24 months0.50%
36 months0.50%
60 months0.50%

To put the offers above in perspective the current national average for a 12 month and 60 month CD sit at roughly 0.22% APY and 0.47% APY, respectively. That said, more competitive offers can be found online or through a handful of credit unions.

All accounts at Total Direct Bank are FDIC insured up to the maximum deposit amount of $250,000 per depositor or $500,000 for joint accounts.

Upon the maturity date of your CD you will have a 10 day grace period in which you may withdraw (or add) funds. If nothing is done, the money will auto renew into the same product at the current rate. Total Direct Bank will mail you a “Maturity Notice” prior to the maturity date, but you’ll want to set up reminders and alerts for yourself as well.

TotalDirectBank Review and Customer Sentiment

Reviews of Total Direct Bank are mixed with aggregate numbers sitting between 2.5 and 3 stars out of 5 on popular third party review sites.

They have no native apps to download on either IOS or android which is unusual for a digital bank.

Total Direct Bank does appear to have good phone support, but only during business hours. If you call outside the 9:00 AM to 5:00 PM window, you won’t get anyone on the phone. That should be fine for most customers and it’s clearly stated on TDB’s “contact us” page.

Data aggregation and problems setting up ACH seem to be limited to 2019 Q4 and early 2020 Q1. Outside of that window, I’m seeing a lot of happy customers, so Total Direct Bank may have fixed some issues in their back end.

Final Thoughts

Total Direct Bank’s CDs and money market account are fairly mediocre on rates and fall behind on both range of account offerings and minimum deposit requirements.

A $25,000 minimum deposit requirement on a CD is about as steep as they come for accounts like these. Online banks generally stay in the $0 – $2,500 range.

Their lack of apps for both IOS and android is also unusual for an online bank, but their online banking interface and phone support seem to meet the bar.

Filed Under: Money Market

Everything You Should Know About Zelle

Kevin Flynn
November 9, 2020

Electronic funds transfers (EFTs) have been around since the 1870’s. Wells Fargo was the first to implement them and the Federal Reserve Bank started wiring money by telegraph in 1910. Credit cards came along in the 1950’s, giving Americans the ability to spend without having to carry cash. In 1959, American Express introduced the first plastic card for electronic payments.

It’s all established technology at this point. Prior to the launch of digital currencies like Bitcoin, the most recent evolution in electronic money was the 1972 creation of the automated clearing house (ACH) transfer for large batches of transactions. That came with a new regulatory body (NACHA) and opened the door for what would later become known as online banking.

That brings us to digital money transfers. They differ from EFTs or ACH because there’s no waiting period to access your money. Mobile applications can send and receive money with the click of a button.

Zelle, one of the leaders in this space, is the subject of my review today. For those not familiar, I’ve also included a company history and competitor analysis.     

What is Zelle and How Does It Work?

Zelle is a digital payments network. They are owned by a company called Early Warning Services, which is in turn owned by a conglomerate of banks that includes Bank of America, BB&T, Capital One. JPMorgan Chase, PNC Bank, US Bank, and Wells Fargo. This makes them different from other services that are solely owned by private or public companies. 

Zelle was officially launched in 2017, but it’s been around since 2011, when it was known as clearXchange (CXC). The original owners were Bank of America, JPMorgan Chase, and Wells Fargo. Their objective was to easily facilitate digital transfers for person-to-person, business-to-consumer, and government-to-consumer fund movement.

From the beginning, the company connected senders and receivers of money through member websites and bank accounts. They connected directly with the bank, eliminating the need to charge transfer fees. In 2015, they announced the establishment of a “real-time” payment system, which was somewhat of a misnomer because it still took 3-5 days for funds availability.

The modern evolution of the company known as Zelle began in 2016 when CXC was sold to Early Warning Services, another bank-owned entity. Shortly thereafter, CXC stopped doing person-to-person transfers and encouraged all their clients to join the newly established Zelle network. Eventually, all functions of the original CXC network were moved over.

Sending and Receiving Money with Zelle

Today, members of the Zelle network can send and receive money using their email address and member bank account. Money is typically available within minutes and the network itself has grown to include other banks and credit unions. They also have a mobile app available on the App Store (4.8-star rating) and Google Play (over 10 million installs).

When I first learned of this app, I thought it was simply another version of Venmo. That is not the case. Venmo is owned by Paypal, which is owned by eBay. Zelle is owned directly by banking institutions, so the transfers happen faster and are less likely to get held up by internal or aggregation issues with the payment provider. Zelle more closely resembles Popmoney in terms of functionality but still differentiates itself.

I also like the fact that money is transferred digitally from bank account to bank account, with no middleman. That (hypothetically) makes Zelle more secure than other apps. The fewer hands that a money transfer has to pass through, the lower the likelihood of an interruption or hack in the system. For that reason, more businesses use Zelle for larger transactions. 

Setting up to use Zelle is simple. You begin by downloading the mobile app from either the App Store of Google Play. You then assign permissions for notifications and location tracking, followed by entering your mobile phone number. There’s a privacy disclaimer that follows that. Check an affirmative on that and the app will then ask you where you do your banking.

This is where I ran into an interesting feature. My credit union was not listed in Zelle’s database, so I thought they wouldn’t allow me to join the network. Not the case. They simply asked me for my debit card number and then to fill out the standard name and address fields. I was then taken to a screen to choose a password and enable touch id. No extra steps necessary.

When delving deeper into the functions of this app, I was pleasantly surprised to see how simple it is. You can send money or request money. When hitting either function for the first time, the app asks you for access to your contacts, which happens instantly. I was literally set up and ready to send and receive money in under five minutes. 

I can choose to invite friends to join the network or simply wait until there’s a need and have an email sent when I initiate a funds transfer. There are no pop-up ads and from what I can see no solicitation to purchase any other services. I was concerned that I’d be headhunted by the banking partners, but I haven’t seen any of that type of behavior yet.  

Banks and Credit Unions currently using Zelle

There are nine hundred twenty-four banks and credit unions on the Zelle network. That’s too many to type out here, but you can see the complete list by visiting the Get Started page on their main website. The full list is not available on the mobile app. You can do a search and, as I mentioned above, connect using your debit card if your bank is not a member. 

If you run a small business and want to use Zelle to process payments, your bank must be in the network. You can check with your bank to confirm this or check the master list in the get started section of the website. Banks wishing to join the network can contact Zelle directly, so suggest this if you like to have the ability to use Zelle for business. 

In 2020, the Zelle network had a total volume of $133 billion, representing 519 million transactions. They do all this through their member institutions, but they also have processor partners, network partners, technology partners, and mobile device and risk partners. A list of each of these can be found on the Partners page of their website. 

These numbers are expected to rise in 2021, so expect the partner network at Zelle to grow even larger. According to the Federal Reserve, over two thirds of non-cash payments this year were done via electronic or digital transfer. Cash isn’t obsolete just yet, but it’s definitely become a less popular medium for exchange. Digital is where the future lies. 

Zelle Fees & Competitor Analysis

Surprisingly, Zelle doesn’t charge fees for sending or receiving money. However, your bank or credit union might. Before initiating a transfer of any kind, check with your bank to make sure you don’t get surprised by an extra charge. This goes for small business accounts also. Your bank may charge you for digital transfers, but Zelle will not.  

Venmo, which is Zelle’s closest competitor, doesn’t charge fees for transfers either, provided you have money in your Venmo account to cover the transfer. If you do not, and have to use a credit card, there’s a 3% charge. Transferring money into a Venmo account takes one business day, so many customers get stuck paying the fee if they need the money immediately.

Though not a fee per se, Venmo also has a social media component, which allows friends within the same network to track each other’s activities. Some customers find this to be annoying, while others embrace it. I’m only bringing it up here to make readers aware of everything they need to watch out for when signing up for these apps. There’s more on this below.

Zelle Transfer Limits by Bank

Most banks and credit unions have digital transfer limits on the amount you can send and also the number of transfers you can do per month. Zelle doesn’t list all of these out per institution on their website, but we’ve tracked down the daily and monthly limits for some of the largest banks.

InstitutionDaily LimitMonthly Limit
Ally Bank$5,000$10,000
Bank of America$2,500$20,000
BB&T$1,000$5,000
Chase Personal Checking$2,000$16,000
Chase Business Checking or Private Client$5,000$40,000
Citibank (Basic and Access Accounts)$2,000$10,000
Citi Priority, Citi Gold, Citi Private Bank$5,000$15,000
CIT Banknana
Citizens Bank$1,000$5,000
PNC Bank$1,000$5,000
TD Bank$1,000$5,000
TD Bank 3-day Transfer$2,500$10,000
U.S. Bank$2,500$10,000
USAA$1,000$10,000
Wells Fargo$2,500$20,000

If you’re banking with an institution that does not offer Zelle, you will have a limit of $500 per week on transfers. If your bank or credit union does, then you might be able to transfer larger amounts. You will need to contact your financial institution for specific spending limits.

On the receiving end, Zelle does not set any limitations to how much you can accept.

Zelle for Business

Customers and small businesses alike are increasing their usage of Zelle. In the first half of 2020, a total of $133 billion was sent through the Zelle Network on 519 million transactions as of June 30, 2020.

That said, this is still an area where I would urge caution when choosing Zelle or any other digital transfer app(s). The New York Times had a feature piece on Zelle and fraudsters exploiting weaknesses in the banks’ security back in 2018.

So while it seems to be great for personal use and even perhaps occasional business transfers, I wouldn’t rely on it as a sole means of transferring money while doing business. There are other, more reliable and secure methods of doing this. Speak to your bank or accountant about those.

In today’s fast-paced world, the desire to move money instantly is understandable, but caution should be exercised when you start dealing with larger amounts. Breaking a transaction into multiple milestones is a good idea for service projects. Asking for other options besides digital transfer may be the right route also. Perhaps an ACH would be a better option.

How Safe is Zelle?

NYT feature piece on Zelle security (or lack thereof) in 2018.

Any application can be compromised by a dedicated hacker. Zelle is not an exception to this. Is it safer than its competitors? Many would say no. The lack of two factor authentication and the simplicity of the setup process make it simple for “ghost” users to set up accounts and scam money from unsuspecting consumers. Security is in the hands of the user. 

One thing I would recommend is to activate the touch id feature when you set up your account. This makes it more difficult (though not impossible) for someone to use your Venmo account if you happen to lose your mobile phone. I’d also decline the autosave on the password function. Choose a password only you would know and enter it manually when you want to use Zelle.

Security is actually an area where Venmo has a better reputation than Zelle. Criticized over their lack of authentication protocols, Zelle has been misused on a number of occasions by unscrupulous vendors that only needed a phone number and email to set up their account. Scammed customers have no legal recourse, because the money is gone from their accounts.

Venmo is essentially a transfer station where money needs to be parked before it can be sent. That additional step may slow things down a bit, but it offers an additional level of protection for their customers. Zelle doesn’t do that. In some cases, Zelle users have had their entire bank accounts wiped out by not paying attention to their personal password or device security.

Zelle Feedback and Customer Sentiment

I browsed through a number of review sites for this app and didn’t really come back with a warm and fuzzy feeling about them. On Trustpilot, they’re showing an aggregate score of 1.2 out of five stars, with 221 documented reviews. The app store has them at 4.8, but the bad reviews tell a common story. Google Play has them at 4 stars out of a possible 5.

Having done a number of reviews, I generally try to look beyond the aggregate and find where the real issues are. There are a lot of complaints from Zelle users with Chase bank accounts, leading me to believe that Chase might be the actual problem. There are also quite a few complaints about using banks and credit unions outside the network.

What I did not see was a single complaint about the usability of the app itself. That does not surprise me. Simplicity in technology impresses me. Having worked in fintech for over a decade, I can tell you it is not an easy task to make an application simple and user friendly. The folks at Zelle did a really good job at this, so I’ll give a thumbs up in that area.

Security seems to be a big concern. Just for kicks, I did a review search on the App Store for Venmo and found no security-related complaints, though there were quite a few about it being hard to get money out of your account. Personally, I’d rather deal with held money than lost money, but that’s just me. Zelle needs to make some improvements in this area.

Here’s another number for you. Zelle has a 4.8-star rating with two hundred sixty thousand customer reviews. Venmo has a 4.9-star rating with over ten million reviews. Obviously, the latter is more popular, but Zelle actually handles more money per year. That shows a trend for bigger, likely business transactions. Personal accounts are where the problems are.

Final Thoughts

I’m not a fan of either eBay or Paypal, so my first instinct when I heard about Zelle was to find as many ways as possible to show they were better than Venmo. Unfortunately, I just never got there. This app is okay, but I can’t say with any conviction that I’d recommend them over Venmo. I wouldn’t refuse to use them either, but they are not my first choice.

While writing this review, I used the same process I always do. I started with their main website. Like the mobile app, it’s clean and easy to navigate, but I found it to be lacking in certain areas. The digital transfer limits for their partner institutions would have been nice to see, yet there was barely any reference to there actually being any.

Another red flag for me is the blog. There’s no link to it in the top navigation menu and I’m not surprised. After finding the link, way at the bottom of the page, I found nothing but promotional content on the blog. There’s nothing educational that actually adds value for their users. This, to me, shows immaturity in their marketing process.

Make sure you read the “User Service Agreement.” In section 3, titled “Prohibited Uses,” it states that, “The Service is intended for personal, not business or commercial use. You agree that you will not use the Service to send or receive payments in connection with your business or commercial enterprise.” If that’s true, why is there a “Small Business” page?

Maybe I’m splitting hairs, but little things like that tend to get my guard up. I don’t think in this case it’s an intent to mislead, but I do feel that Zelle is organizationally challenged. It feels like it was put in place to be a “members only” money highway, with network expansion only done to raise the volume of assets moving through the system each day.

All that being said, Zelle can be a useful tool when used for occasional transactions. I would feel comfortable sending a close friend or family member funds with this app, but I’d have serious misgivings about using it with strangers or for business transactions. I think it needs to mature as a technology platform before it’s ready for that.  

Filed Under: checking accounts Tagged With: Zelle

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  • Chase Bank CD Rates
  • Wells Fargo CD Rates + Way2Save
  • U.S. Bank CD Rates

The Online Banks

  • Ally Bank CD Rates
  • Comenity Bank CD Rates + Online Savings
  • Discover Bank CD Rates
  • PNC Bank Savings + Virtual Wallet Checking
  • TAB Bank CD Rates + Online Savings
  • Vio Bank CD Rates + Online Savings

Noteworthy Credit Unions

  • Navy Federal Credit Union CDs and Savings
  • Patelco Credit Union CDs and Savings
  • PenFed CDs and Savings
  • Connexus Credit Union CDs and Money Market

Brokered CDs

  • Edwards Jones
  • Charles Schwab
  • Fidelity

Alternatives

  • 12 Alternatives to CDs and Savings Accounts

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