That's what you're seeing Visa, Paypal, and others attempt to go upmarket (business payments) or branch out (crypto, Plaid acq attempt).
https://www.zellepay.com/press-releases/zeller-closes-2020-r... (Zelle® Closes 2020 with Record $307 Billion Sent on 1.2 Billion Transactions, Nearly 7,000 financial institutions are represented in the Zelle Network via their customers using the Zelle common mobile app, Achieving ubiquity with banks and credit unions: Nearly 500 new financial institutions of all sizes joined the Zelle Network® in 2020)
https://www.businessofapps.com/data/venmo-statistics/ (Venmo key statistics. Venmo processed $159 billion in total payment volume in 2020)
If anyone can plug into instant payments, your value as an instant payment provider that just does payments will fall rapidly.
Really looking forward to a governmental, ubiquitous solution.
One might assume this feature will be built into banking apps as time goes on and instant payments are ubiquitous. It's already in my Chase iOS app [1]. I argue it's a feature, not a business. I concede we'll have to see what happens when deposit accounts at real banks are given access to instant payment functionality.
[1] https://www.chase.com/digital/customer-service/helpful-tips/...
The thing that makes this a bit trickier is that Zelle is transparently used under the hood by some banks to move money between accounts owned by the same person. I've moved thousands of dollars between two of my accounts with Zelle but the alternative would have been an ACH transfer or depositing a check to myself, not Venmo.
I know it's just one anecdote, but when splitting a check, my social circle always reaches for Venmo, never for Zelle. And yet I've probably moved more total money via Zelle because I occasionally use it for different, higher-value transactions.
There's some selection bias at play for different transaction types (including many where people might not even realize they're using Zelle) so we should be careful looking at only the headline numbers.
Is it? I just did a straw poll of people in my office, located in Canada. People from 28-50 no one has venmo. 3 of 15 knew about it.
Now my sample may not match the rest of the world as these are some pretty highly educated and high networth individuals so venmo isn't something that would really benefit us, but it does really weaken the ubiquitous claim
Where is Venmo ubiquitous?
Always remember that consumer banking in the US is at least a decade behind everywhere else in the first world. Apps that allow cheap/free and fast money transfers were and still are a big deal there.
https://www.pymnts.com/news/faster-payments/2021/five-banks-...
https://corpgov.law.harvard.edu/2020/08/31/fednow-the-federa...
What's your hot take on this new FedNow system vs. what Zelle tries to achieve via ACH? Do you think it'll be more "Venmo-like" (low friction) or will it end up a usability mess due to regulation requirements?
Hot take: banks being banks, they'll crowd out fintechs because fintechs aren't chartered banks regardless of the UX (which is why Bancorp Bank is the underlying for so many fintechs).
[1] https://techcrunch.com/2017/06/12/zelle-the-real-time-venmo-...
Now that's interesting - does that imply that the clearing delays in transfer (say your US Bank to your Brokerage, ~3 days ACH) will disappear and FedNow makes that an "instant" (within 1 day let's say) settled transfer? Very intriguing.