It’s been a long search, but I finally found someone who was open to being paid through person-to-person (P2P) payments. The process was swift, seamless and, most importantly, free. With a great first-hand experience, I understand why banks are making the effort to market this service. However, some consumers remain reluctant to try P2P payments — suggesting there is an increasing need for a single, unified P2P-payments system.
Last year, I wrote on the hurdles that discouraged consumers from using P2P payments. One of the biggest factors is the inconvenience for recipients, who go through the hassle of entering their personal and financial-account information to collect their payments.
I’ve tried to pay family and friends by sending money through Chase QuickPay, Chase’s free P2P payment service. But after learning that they would have to sign up for Chase QuickPay (since they are not Chase customers), they immediately rejected that payment method and opted for cash or a check.
Between Chase customers, the process is much simpler because the bank already has information on both the sender and the recipient.
Over the weekend, I had to repay a friend for buying me a few items with his employee discount at a retailer. Both of us happen to be Chase customers — the opportunity I’ve been waiting for. It took me less than 30 seconds to make a QuickPay payment on my phone. It was even faster for my friend to collect the money — it was ready for him to collect after he logged into the Chase mobile app on his phone.
Non-Chase customers would have to find their bank’s routing number and their account number to receive a P2P payment. For them, it almost feels like a chore.
Another friend who is already a Chase customer won’t even bother to enroll for Chase QuickPay on his account.
With the hoops involved, how can the banking industry expect customers to adopt a feature that works well only between a certain bank’s customers? The endless television ads for P2P payments — such as those for Chase QuickPay and Citibank Popmoney — won’t do any good if the experience is inherently tedious.
Fortunately, banks aren’t oblivious to this obstacle to adoption.
In 2011, Chase, Bank of America and Wells Fargo — the three largest banks in the U.S. — collaborated to create clearXchange, a network that allows customers among partnered banks to make P2P payments without requiring recipients to provide account information. ClearXchange may even partner with Popmoney, a third-party P2P-payments servicer that works with banks such as Citibank and Ally Bank.
But, these ventures are still slow to expand — possibly because there isn’t enough customer demand to simplify P2P payments.
So, if you haven’t tried sending or receiving P2P payments, I encourage you to do so. You’ll embrace this new form of financial convenience because it makes your life easier. Banks will notice and they’ll work harder to offer it to everyone. (Just look at how mobile check deposit became a most-wanted feature.)Related