Why Zelle Falls One Step Short of Being an Unbeatable Solution
On the back of impressive sign-up numbers and more than 100 million transactions this year, just last month Zelle released a stand-alone mobile app available to anyone with a debit card. Now officially a Venmo competitor, does Zelle really have what it takes to help banks recapture the millennial market?
In just a few short years, the payments landscape has changed dramatically. PayPal, Venmo, Square Cash, and the likes aren’t merely successful apps; they’ve popularized an entirely new way of transferring money that could eventually replace cash. And what do they all have in common beyond being non-bank services? They’re quick, social, and they’ve seen huge popularity with the millennial population.
Launched earlier this year, Zelle is the US big banks’ answer to the exponential growth that the P2P mobile payments market has seen over the last few years. A ready-made platform that banks can build into their existing apps, Zelle offers significant advantages to both banks and customers.
Banks are hoping that the advantage of instant transfers (as opposed to the waiting period customers of third-party providers like Venmo see), in combination with the assurance of a bank’s security framework, will be enough to see Zelle become a leading contester in the $200 billion US P2P payments market and a means to regain control of the customer relationship.
However the key to success for banks lies not just in where millennials make payments, but where they are spending their time. And this is where Zelle — and even Venmo — falls short as a solution that can not only capture, but firmly hold onto the engagement of the millennial market into the future once Facebook, Snapchat, and the likes develop and enhance their own financial services. As a service that is aimed at improving the payments experience and being attractive to millennials, Zelle stops one step short of what millennials are looking for (and where they’re looking for it).
A generation defined by their access to instantaneous services — a taxi in one tap, a pizza in a click — millennials are increasingly expecting companies and services to be available to them at any channel of choice, at any time. Having to leave a social or messaging app, where users are spending so much of their time, and switch to Zelle’s app (or a Zelle powered banking app) in order to make a P2P transfer really isn’t the type of quick and seamless user experience that is coming to be expected.
In order for banks to be attractive to the millennial market and to see long term growth and retention of this market, they must look at opening new service channels and meeting customers wherever they are, and not vice versa. We’re now at a time where it’s no longer enough to simply be mobile-first. With users now spending around 2.5 hours every day on social and messaging apps, banks need to be social-first.
The keyboard — an extremely valuable piece of real estate on smartphones that even the biggest tech titans such as Microsoft and Google have set their sights on — can be utilized to offer the ultimate cross-channel experience and to increase brand engagement. PayKey is a social banking solution that utilizes the keyboard, which is present in nearly every application, in order to take the banks to their customers, and not the other way around.
With PayKey, banks can transform the smartphone’s keyboard into a new channel for financial services, information, and communication, and enable their customers to make and request payments (or any other financial service) instantly, not just from the bank’s app, or from Zelle’s app, but from any app, at any time.
Zelle is a great step forward for banks, offering much needed innovation for the payments experience. PayKey offers US banks a unique opportunity to enhance the capabilities of Zelle, and make the mobile banking experience truly contextual, frictionless, and instantaneous.
The time of customers going to their banks is over, it’s now time for banks to go to their customers!