Zelle is an online payment network by which senders can send money and receive money in a simple manner to and from bank accounts. Zelle is owned by Early Warning Services, LLC, a private financial services business owned by the largest seven banks in the U.S., i.e., Bank of America, Truist, Capital One, JPMorgan Chase, PNC Bank, U.S. Bank, and Wells Fargo. Zelle is a fast and easy peer-to-peer (P2P) money transfer service for the movement of money between the bank accounts of the U.S.
How Zelle works
Users must register for Zelle through a partner bank. New consumers cannot register in the Zelle application beginning January 8, 2025, and beginning March 31, 2025, will no longer be able to send or receive money with the standalone application. A bank mobile banking application or online banking website can be used to get Zelle. A U.S. mobile phone number or email address must be linked with a bank account to register.
You will require the receiving person’s signed-up email address or U.S. mobile number in order to send money. The money will typically be made available in a matter of minutes if the receiving person is signed up. Otherwise, the receiving person will be required to sign up and finalize the transaction. Zelle sends money using the Automated Clearing House (ACH) network, which is similar to direct deposit, although most payments are much quicker.
Transaction limits vary by bank and by the type of account. Wells Fargo limits transfers to $2,500 for the day and $20,000 for a 30-day period, while for Chase, it limits the transfers to $2,000 for the day and $16,000 for a calendar month.
Security features of Zelle
Zelle employs robust security measures to protect the information of users:
- Data encryption: Zelle encrypts user data in order to render it unavailable to unauthorized persons.
- Firewalls: Keep unauthorized data out of the network in real-time.
- Device security: The device security features, such as face or fingerprint scanning, can be enabled by the user.
- Access controls: Access is rigorously controlled so as to preclude access to confidential information.
Zelle does not have purchase protection or payment refund, hence it is safer to use the service with people known to you.
Pros and cons of Zelle
Pros
- Instant: Transfers happen almost in real-time, which makes it a reliable choice for quick payments.
- No charges: All the users are charged no charges for receiving or sending money with the respective banks.
- High availability: Zelle is backed by over 2,200 banks, thereby making it highly accessible.
Cons
- No purchase guarantee: The money cannot be reversed once paid for, and it cannot be retrieved in the case of the wrong person receiving it or it being a scam.
- Fraud risk: The consumers should remain vigilant in order not to be cheated as Zelle will neither refund nor provide chargebacks.
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