15th Annual Field Guide to Innovative Payments

It’s May, and that means it’s time for our annual exercise to seek out and describe the payments players, apart from the big networks, that are rewriting the rules for the digital exchange of value.

Since 2004, Digital Transactions has traced the course of payments innovation through its nimblest practitioners—the startups, the fintechs, the smaller networks, the nonbank arrivistes—and their services and products, their strategies and tactics, their successes and pratfalls. In 2009, we distilled what we were learning about these innovators into a handy guide inside the May issue, and called it a “field guide” to what were then known, somewhat cheekily, as alternative payments.

Well, the guide worked out so well we decided to update it every May. And so you now hold in your hands the 15th edition. A few years ago, we dropped the “alternative payments” rubric and renamed our effort as a guide to innovative payments. We think the new adjective better fits our purpose in sorting out the varied new pathways the nonbanks, and yes, banks and major networks, are forging for the payments business.

The guide is as much about strategies and tactics as it is about emerging technology and new markets. We invite you to read this guide much as you have since 2009, with an eye to how it might inform your decisions, sharpen your competitive instincts, and bring to light, perhaps, some developments you had not encountered before—as well as spotlight some potential partners.

Digital Transactions generally defines an innovative payment system as any network or consumer interface (a mobile app, for example) that enables payments in a way that relies on or stands apart from a major network and/or stands between that network and the consumer in an important way. We emphasize consumer-facing payment systems, but of course many, if not most, of the systems profiled here market themselves to merchants to maximize acceptance of their products.

Information for the listings comes from news reports over the past year, company Web sites and spokespersons, and financial filings in a few cases. We mention pricing for the merchant and consumer when it is relevant and publicly available. The “Year Founded” line refers to the year the particular service was founded, not the parent company, except in those cases where the two coincide.

Alipay
Parent: Ant Financial Services Group
Headquarters: Pudong, Shanghai, China
Founded: 2004
Web: https://global.alipay.com/platform/site/ihome
Field Notes: Alipay’s latest development is to offer a Pay After Delivery option built on Splitit Payments Ltd.’s technology. Splitit is a white-label buy now, pay later provider. Pay After Delivery allows consumers to make a purchase using a credit card, then pay for it after delivery. The payment option is being offered at AliPay’s request, a Splitit spokesperson says. AliExpress is an e-commerce marketplace owned by Alibaba Group Holdings Ltd., which operates the Alibaba.com marketplace and holds a 33% stake in Alipay. Founded in 2004, Alipay has grown into what is said to be one of the largest mobile-payments services globally. It has also made prior moves to penetrate the U.S. payments market, including a deal with the Guess? Inc. chain in 2018. Before that, it had concluded a deal to collaborate with the big U.S. processor First Data Corp., now part of Fiserv Inc., to process mobile payments for U.S. sellers that attract significant numbers of Chinese tourists.

Amazon Pay (includes Amazon One)
Parent: Amazon.com Inc.
Headquarters: Seattle
Founded: 2007 (including predecessor services)
Web: pay.amazon.com
Field Notes: Amazon made a big splash early this year with the announcement the first non-Amazon-owned merchant would accept Amazon One, it’s biometric payment product. Panera Bread was to test the palm-print payment technology at select locations in St. Louis, Mo. The deployment of Amazon One, which links a customer’s payment card to his or her palm print, is expected to make it easier for Panera customers to access their rewards, as the palm-reading technology also identifies users enrolled in the sandwich chain’s loyalty program. The chain, which is reportedly the first national restaurant operator to install Amazon One, has more than 52 million consumers enrolled in its loyalty program, and plans to expand Amazon One to more locations. Panera has 2,113 company and franchise operated bakery-cafés in 48 states and Ontario, Canada, operating under the Panera Bread or Saint Louis Bread Co. names. The Amazon Pay wallet, which allows users to store credit and debit cards, includes the ability to pay by voice via Amazon’s Alexa technology. Alexa can also alert users when a delivery is made or when a bill comes due. Amazon Pay Deals, meanwhile, presents offers meant to be exclusive to users.

Apple Pay
Parent: Apple Inc.
Headquarters: Cupertino, Calif.
Founded: 2014
Web: apple.com/apple-pay
Field Notes: Several months after announcing a buy now, pay later service, Apple Inc. finally launched Apple Pay Later in March, albeit to a limited number of Apple Pay users. The self-financed installment-payment service works much like other BNPL services by spreading four payments over a six-week period for purchases between $50 and $1,000. Apple also is conducting the credit assessment and lending steps and intends to report consumer activity to U.S. credit bureaus. Apple Pay Later uses Mastercard Inc.’s installment-payment infrastructure. The BNPL service complements the Apple Card, a credit card issued by Goldman Sachs, which debuted in 2019. In other Apple Pay news, PayPal added it as an online checkout option for small businesses. And grocer Ralphs began accepting Apple Pay in late 2022. Ralphs is owned by Kroger Co., which launched its proprietary mobile-payments service Kroger Pay in 2019.

Blockchain
Founded: 2010
Field Notes: Since blockchain architecture emerged more than a decade ago, it has spawned dozens of cryptocurrencies and even lent itself to slick applications that bind parties to a transaction, such as smart contracts. But it remains the object of skepticism—even scorn—among many in payments and finance. Events of the past year—most prominently, the utter collapse of the big FTX exchange—have served to fuel that fire. Later, the failure of crypto-friendly Silicon Valley Bank and Signature Bank only added to the ignominy in which blockchain found itself. Still, many adherents hold out for Bitcoin, whose value roller-coastered through 2022 and into 2023, and for the possibility of a digital dollar, a national currency managed by the Federal Reserve.

BNPL (Affirm, Klarna, Splitit)
Field Notes: From vacations and cannabis products to business-to-business purchases, there isn’t much consumers can’t purchase with a buy now, pay later loan. The seeming ubiquity of BNPL loans, which allow consumers to pay for a purchase over a preset number of monthly payments, is predicted to catapult the number of BNPL users to more than 900 million by 2027, up from 360 million in 2020, says Juniper Research. The growth is expected to be driven in part by increasing demand for low-cost credit solutions and consumers’ desire to increase their buying power during inflationary times. Despite the rosy outlook, BNPL providers are not immune to downturns. Rising interest rates forced Affirm Holdings Inc. to announce lower-than-expected financial results for the fourth quarter of 2022 and lay off 19% of its workforce. Nevertheless, competitors continue to find new ways to grow. Klarna AB has added its BNPL option to Ingenico’s cloud-based payments-as-a-platform service, while Splitit Payments Ltd. is available on AliPay’s AliExpress e-commerce marketplace.

Cash App
Parent: Block Inc.
Headquarters: San Francisco, CA
Founded: 2013
Web: cash.app
Field Notes: By January, Block’s Cash App wallet had attracted 18 million active users, enough to add yet another new feature: Cash App Savings. The feature lets users save money by rounding up purchases when using the app and setting savings goals. Block can offer the feature because it owns Square Financial Services, a bank chartered by the Federal Deposit Insurance Corp. and Utah Department of Financial Services. This adds to Cash App’s already wide utility. The wallet lets users transfer money, use direct deposit, deploy a linked card, and buy Bitcoin, the favorite cryptocurrency of Block CEO Jack Dorsey. Such moves are paying off handsomely, with Cash App generating more than half of Block’s gross profit in 2022’s fourth quarter, or $848 million, up fully 64% year-over-year. That makes Cash App bigger than Square, the point-of-sale technology business the company started with 14 years ago. Now, Block is trying to link its two chief businesses. An example: late last year, the company launched a “Discover” tab that lets users zero in on Square merchants that accept Cash App Pay, the app’s payment facility. And Cash App is now being offered to merchants that accept Afterpay, the buy now, pay later platform Block paid $29 billion to acquire last year.

Clover
Parent: Fiserv Inc.
Headquarters: Sunnyvale, CA
Founded: 2012
Web: Clover.com
Field Notes: Clover, processing giant Fiserv’s point-of-sale technology, continues to be a potent growth engine. Clover posted $232 billion in gross payment volume in 2022. Merchant volume and transactions grew 6% and 3%, respectively, during the fourth quarter. Helping fuel Clover’s growth were deals with AMS Global, a Los Angeles-based venue and event-management company, to install more than 1,000 point-of-sale devices from Fiserv’s Clover Sport unit across three New Orleans sports and entertainment venues. The terminals will enable fans to make digital, contactless, and self-service purchases at kiosks and grab-and-go marketplaces, as well as access mobile ordering, loyalty, and stored-value payment options. At the time of the deal, more than 300 sports and entertainment venues were already using Clover Sport to provide payment and marketing services to fans. Clover also has a footprint in the buy now, pay later space, enabling merchants using its POS terminals to offer BNPL loans through Synchrony Financial.

Google Wallet
Parent: Alphabet Inc.
Headquarters: Mountain View, CA
Founded: Android Pay, 2015; Google Wallet, 2011
Web: pay.Google.com
Field Notes: Google Wallet exponentially expanded its potential user base with the 2022 availability in 12 more countries for a total of 57. Google Wallet was relaunched in 2022 to accommodate digital elements, such as driver’s licenses and vaccine cards. It also launched WearOS, an operating system for smart watches and other wearables. Google Wallet added support for tapping and paying for public transit rides and the ability to save digital tickets for events and to access airline boarding passes. The decision to enable Google Wallet to be accepted by mass-transit systems was driven by consumers’ growing preference for contactless payment transactions, especially since the onset of the Covid-19 pandemic. Google also added support for two Fitbit wearables as well as the Google Pixel Watch.

MagicCube
Parent: MagicCube Inc.
Headquarters: Santa Clara, CA
Founded: 2014
Web: MagicCube.co
Field Notes: Magic Cube has added a new wrinkle to its strategy of enabling merchants to accept card payments with an off-the-shelf mobile device. It has struck agreements with mobile-device makers to make its iAccept platform the only such technology they will use in North America. MagicCube has reached agreements with France-based MobiWire Group and Belgium-based Oona, a unit of Finland-based Aava Mobile Oy. The deals will help create an ecosystem around iAccept through exclusive partnerships with mobile-device makers that will afford MagicCube more control over such matters as performance, usability, and security, says chief executive Sam Shawki. MagicCube has also added several new features to make its platform attractive to large merchants. Enhancements include: multi-acquirer and multi-merchant support from a single platform; direct integration into complex systems without affecting scope or certification with respect to the PCI data-security standard; and unchanged transaction routing with full control of the existing acquirer and merchant flows.

Marqeta
Parents: Marqeta, Inc.
Headquarters: Oakland, CA
Founded: 2010
Web: Marqeta.com/
Field Notes: This card-issuing platform has been a roll of late. Marqeta kicked off 2023 by enabling card issuers to use its tokenization technology to push tokenized cards to consumers’ mobile devices. Consumers can then use those cards to make purchases. The new technology, called web push provisioning helps reduce mobile-payments friction by eliminating the need to download an app to enable payment. Instead, card issuers can push tokenized cards directly to a consumer’s mobile device from the consumer’s Web browser. The capability is expected to increase mobile-wallet usage and reduce abandonment of wallet-based transactions. Marqeta has also partnered with Bread Financial to launch the Bread Pay One-Time Use Card, a virtual credit card that allows consumers to pay for purchases in four installments. The company meanwhile launched RiskControl, a set of risk-management and compliance tools to help issuers on its platform streamline their risk.

Merchant Wallets
(Dunkin/DD Perks, Kohl’s Pay, Kroger Pay, Starbucks Rewards, Target, Walmart Pay).
Field Notes: Mobile wallets offer merchants a perfect mix of technology and innovation to stay ahead of the curve in the rapidly evolving world of digital payments. For example, many, if not all, of the merchants in this category enable their wallet users to pay online or in-store using a one-time quick-response code that securely transmits payment and loyalty information at checkout. The Starbucks app is so powerful that, in the first quarter of 2023, the mobile order and pay channel, along with drive-thru and delivery, drove 72% of the coffee retailer’s U.S. revenue. Starbuck Rewards, which is closely tied to the app, surpassed 30 million members by the end of 2022, with mobile order use accounting for 27% of transactions at U.S. company-operated locations, Starbucks said. More than $3.3 billion in value was loaded onto Starbucks cards in the first quarter.

Mercedes Pay
Parent: Mercedes-Benz Group
Headquarters: Stuttgart, Germany
Founded: 2023
Web: https://www.mercedes-benz-mobility.com/en/what-we-do/payment-services/mercedes-pay-plus/
Field Notes: Mercedes-Benz has turned a car into a payment device with the release of Mercedes pay+, its in-car payment service. Offered initially in five European models, the service will also be available in U.S. vehicles, though Mercedes-Benz would not say when. Mercedes-Benz is the first, with its Mercedes pay+ technology, to use Visa Inc.’s Delegated Authentication and Cloud Token Framework. The Delegated Authentication service enables an issuer to “delegate authority” to a third party, such as a wallet provider or merchant. Its Cloud Token Framework enables a connected device to become a secure channel for digital commerce. Mercedes-Benz announced in 2021 that it and Visa were working on a native in-car payment service that it had hoped to launch in 2022. In Mercedes pay+, the technologies are integrated into the native in-car payment service, enabling the vehicle itself to provide biometric two-factor authentication in conjunction with a fingerprint sensor. Earlier versions of in-car payment services relied on a user’s mobile phone as one element of the two-factor setup.

Open Banking
Field Notes: As with so many trends in payments, open banking is being driven not by banks but by fintechs. Some 78% of fintechs say open banking is now relevant to their business, according to a study released last fall by Discover Global Network and 451 Research. Consumers like the technology because it offers faster credit approvals and a consolidated view of their financial accounts. Meanwhile, the study indicated some 87% of U.S. consumers have at least one fintech app on a smart phone, and 49% have three or more, underscoring the salience of open banking. The technology lets fintechs and other nonbank payments providers access consumer accounts to verify balances. But regulation may not be far off. The Consumer Financial Protection Bureau last fall released an outline of what it calls a “data-rights rule” that would govern how consumers’ financial information is to be shared among such players as banks and payments companies. The proposed rule aims at preventing financial institutions and other keepers of consumer data from monopolizing that control to prevent competition from other firms and to keep customers from moving to other providers.

Payments Orchestration
Field Notes: Just as a conductor evokes sweet notes from a collection of players who could just as easily be producing a cacophony, this technology uses application programming interfaces to select just the most efficient providers and payments routes to handle the customer’s payment choice at just the moment of the transaction. The technology is very recent, but already the payments industry seems to be settling on the proper vocabulary for it. The programming is widely referred to as a “payments-orchestration layer” that lies between the merchant and his processor. If working properly, it helps online merchants, large and small, manage enormous increases in demand from jurisdictions where parsing currency conversions, local payment methods, alternative payment methods, routing choices, and payment processors can be a very bad headache. The idea is to orchestrate all the elements of a transaction—acceptance of the customer’s payment choice, just the right gateway, and the right processor—to satisfy the customer. The goal is to avoid cart abandonment and keep the merchant’s transaction price at the lowest level that can still meet all the various networking costs.

PayPal
Parent: PayPal Holdings Inc.
Headquarters: San Francisco, CA
Founded: 1998
Web: paypal.com
Field Notes: 2023’s second quarter started out with a bang for PayPal, as its Braintree unit won a contract to process transactions for TicketMaster, the giant events-ticketing supplier—a big win considering live events are resuming following the worst of the pandemic. Indeed, Ticketmaster’s parent, Live Nation Entertainment Inc., reports the unit processed $27.5 billion in ticket volume last year, up fully 54% from 2019. What’s more, PayPal says its entire range of payments services, including Venmo, PayPal Checkout, and PayPal Later, its buy now, pay later product, can all be used on Ticketmaster. But this development followed another big deal: PayPal’s agreement to support transactions on Apple Inc.’s Tap to Pay on iPhone technology, which lets merchants process cards with a tap on an ordinary iPhone. This move in turn was followed in April with the announcement that PayPal merchants can offer Apple Pay at checkout. But PayPal must soon replace it top executive. Long-time PayPal president and chief executive Dan Schulman stunned the industry in February by announcing he will retire at year’s end, while retaining a seat on the board. That has set off a search for a replacement to run the massive payments company.

Paze
Parent: Early Warning Services
Headquarters: Scottsdale, AZ
Founded: 2023
Web: paze.com
Field Notes: In March, the big-bank-owned Early Warning operation, the creator of the Zelle peer-to-peer payments network (see Zelle entry below), launched what is likely to be its most ambitious project yet—a digital wallet owned and controlled by banks and open to multiple bank-issued cards. Many details remain to be spelled out, but the wallet, aimed exclusively at e-commerce use, will be tested this summer and made available generally in the fall. With a wide scope of issuers, EWS expects banks representing 150 million cards to be participating in Paze by the time of the commercial launch. Cardholders at participating banks will see their cards preloaded in a Paze wallet. The introduction of Paze follows months of speculation about EWS’s wallet project, news of which first emerged in January. The banks that own the Scottsdale, Ariz.-based company—Bank of America, Capital One, JPMorgan Chase, PNC Bank, Truist, U.S. Bank and Wells Fargo—are also among the nation’s largest card issuers.

PayNearMe
Parents: PayNearMe, Inc.
Headquarters: Santa Clara, CA
Founded: 2009
Web: home.paynearme.com/
Field Notes: PayNearMe has been making lots of waves with its payment platform. The company has established a substantial footprint in iGaming. It’s deal with Lottery Now Inc., which operates the Mido Lotto lottery in nine states, enables consumers to purchase tickets with, as well as make deposits to and withdrawals from, their Mido Lotto digital wallets using credit and debit cards, Venmo, and PayPal through PayNearMe’s MoneyLine app. The MoneyLine app, launched in 2021, also supports cash and automated clearing house payments. PayNearMe has iGaming and sports betting operations in about 20 states and has developed a mobile app that facilitates cardless payouts through a network of 20,000 ATMs nationwide. PayNearMe also scored a coup for its bill-payment network, inking a deal with Walgreens Co. The deal adds 9,000 Walgreens and Duane Reade locations to PayNearMe’s merchant network, bringing the company’s total to more than 40,000 retail locations.

Real-time payments/FedNow/The Clearinghouse
Field Notes: Long a matter of half action, half speculation, the concept of real-time payments took on momentum with the Federal Reserve’s announcement in March that it has narrowed its launch window to July for its long-awaited FedNow real-time payments network. Formal certification for potential participant was to start last month, while so-called early adopters were finishing a test program to be ready to transmit live payments. The new network, which the Fed has been working on for nearly four years, is a huge development in payments, but the nation’s banking regulator is coming rather late to the party. The Clearing House Payments Co.’s Real Time Payments system, for example, has been commercially available to banks since 2017, and now serves nearly 300 financial institutions. Nor are cardholders without the ability to send money instantly: Visa has offered Visa Direct since 2014, and was followed by Mastercard with Mastercard Send a year later. Still, no network can claim the reach and power of the Fed. Access to FedNow will come through the FedLine network, which is used by more than 10,000 financial institutions, either directly or through agents, for transaction clearing and data transmission.

Secure Remote Commerce (a.k.a. Click to Pay)
Parents: American Express, Discover, Mastercard, Visa
Headquarters: N.A.
Founded: 2019
Web: EMVCo.com
Field Notes: Secure Remote Commerce is not so much a brand as a behind-the-scenes digital-payment mechanism developed by EMVCo, the standards body controlled by the global payment card networks. Referred to as “click to pay” by the networks, SRC’s purpose is to replace the clutter of payment brands on e-commerce checkout pages with a common buy button that offers a unified and simple purchase process. With e-commerce booming, the simplified checkout is getting a workout. CardX, a surcharging platform owned by Stax, added the Mastercard iteration of Click to Pay to its platform. At the time of purchase, CardX informs the customer paying with a credit card the cost of the surcharge and displays the total amount of purchase. CardX also gives consumers the option to pay with an alternative payment method that will not incur a surcharge. In either case, merchants receive 100% of the sale amount. When a consumer pays using a debit card, the CardX platform identifies the card as a debit card and does not levy a surcharge.

Stripe
Parent: Stripe, Inc.
Headquarters: San Francisco, CA and Dublin, Ireland
Founded: 2010
Web: https://stripe.com/
Field Notes: No stranger to innovation, Stripe has upped its game significantly in 2023 by partnering with Open AI, the San Francisco-based creator of the ChatGPT artificial-intelligence chatbot, to enable payments for Open AI’s ChatGPT Plus and DALL·E applications. Stripe will also incorporate OpenAI’s new natural-language technology, GPT-4, into its products and services. The partnership marks one of the first uses of ChatGPT technology for payments. Prior to the deal with Open AI, Stripe made its Tap to Pay functionality for Android phones and tablets available in the United States, United Kingdom, Canada, New Zealand, Australia, and Singapore. Stripe launched Tap to Pay for iPhone in 2022. Despite not seeing the “breakneck” growth it did in 2020 and 2021, Stripe still processed more than $817 billion in total volume in 2022, up 26% from the previous year. More than 100 companies each handle more than $1 billion in payments with Stripe each year, a figure that has grown by more than 50% yearly since 2018, Stripe says.

Tap to Pay (iPhone and Android)
Field Notes: The smart phone has undergone another transformation in the payments world. Now, it’s not just a connectivity device for payment-acceptance dongles but can become the secure payment device itself with the advent of more tap-to-pay services. Long available for Android devices, an iOS-compatible service for iPhone launched last year and has gained traction with several payment processors. Called Tap to Pay on iPhone, the service enables a commercially available, off-the-shelf iPhone to act as payment terminal for NFC-enabled transactions. Merchants are able to unlock contactless payment acceptance through a supporting iOS app on an iPhone XS or later device. At checkout, the merchant will prompt the customer to hold their iPhone or Apple Watch to pay with Apple Pay, their contactless credit or debit card, or other digital wallet near the merchant’s iPhone, and the payment will be completed using NFC technology. Apple said all Tap to Pay on iPhone transactions will be encrypted and processed using the Secure Element in iPhone. It’s not just iOS devices with this capability (see MagicCube entry), as developers are creating Android-based services. Pace Software has developed a software-based terminal following the mobile payments on COTS standard—MPoC—from the PCI Security Standards Council. Pace expects to complete certification in May. Once that’s done, the software will be available through the independent sales organization channel at 3 cents per transaction with no monthly fee or set up, says David Leppek, Pace president. Android is supported now with an Apple version in the works. A version of the software is on some Ingenico Axium terminals, with plans to support all Android terminals eventually.

Venmo
Parent: PayPal Holdings Inc.
Headquarters: San Francisco, CA
Founded: 2009
Web: venmo.com
Field Notes: Few person-to-person payment networks can boast the volume and reach of Venmo, acquired by PayPal in 2013 as part of the Braintree deal and since then a sister P2P service to PayPal itself. In March, both services were recruited by processor ACI Worldwide Inc. to allow taxpayers to make federal tax payments through ACI Payments Inc. It’s the first time Venmo has been offered as an option for federal taxes, according to ACI. PayPal reported in February its Venmo volume reached $62.5 billion in the fourth quarter, up 3% year-over-year and a notable slowdown from a 29% pace in 2021’s fourth quarter. The service includes more than 78 million users, most of them in the United States, according to Business of Apps. It is likely to benefit from an upcoming development that will let users of one P2P service pay users of another, even if the two users are on different networks. The system, announced last month by Visa Inc. and dubbed Visa+, will start up with a test later this year involving Venmo and PayPal, then expand next year to include interoperability with DailyPay, i2c, TabaPay, and Western Union.

Visa Tap To Pay
Parent: Visa
Headquarters: San Francisco, CA
Founded: 2021
Web: https://usa.visa.com/pay-with-visa/contactless-payments/contactless-payments.html
Field Notes: Visa Tap to Pay got to play on a global stage last year as Visa showcased the technology at the 2022 FIFA World Cup last November. Visa deployed 5,300 contactless-enabled payment terminals at official FIFA venues and enabled taxis in Doha, Qatar, capital of the host country, to accept contactless payments by card or smart phone. Tap-to-pay uses short-range wireless technology to make secure payments between a contactless card or payment-enabled mobile/wearable device and contactless-enabled POS terminals. Visa’s Tap to Phone technology, which launched in 2021, enables merchants to securely accept contactless payments on their near-field enabled Android and Apple smart phones by downloading an app. The card network’s Tap to Phone partner program allows acquirers to build and certify a Tap to Phone solution by themselves or partner with an approved third-party. Thousands of merchants in the United States use Visa Tap to Pay including such chain as 7-Eleven, Costco, CVS, Dunkin Donuts, McDonalds, Starbucks, Subway, Walgreen’s, and Whole Foods.

Zelle
Parent: Early Warning Services LLC
Headquarters: Scottsdale, AZ
Founded: 2011 (as ClearXchange)
Web: ZellePay.com
Field Notes: Having established itself as a consumer favorite, Zelle is looking to achieve the same status with small businesses. Small businesses received more than 150 million payments through Zelle totaling more than $72 billion in 2022, an 84% increase from a year earlier. While Zelle says it is still in the early stages of attracting small-business volume, it notes that small businesses are making up more of its payments. Overall, consumers and businesses sent 2.3 billion payments totaling $629 billion through Zelle in 2022. Transaction volumes through Zelle increased 26% in 2022 compared to 2021, while total transaction value increased 28%. That was the good news. The bad news was Zelle drew scrutiny from members of the United States Senate in late 2022 over consumer fraud and scams perpetrated on the network. Several member banks responded to the controversy by developing plans to reimburse victims, while Zelle pointed out more than 99.9% of payments on the network were sent without any report of fraud or scams.