The clearXcxhange P2P Payment Service Adds U.S. Bank As An Owner And User

Person-to-person payment company clearXchange has a fifth owner. U.S. Bank, a unit of U.S. Bancorp, said on Tuesday it had invested in the network and plans to offer clearXchange services. Terms were not disclosed.

ClearXchange was founded by Wells Fargo & Co., Bank of America Corp., and JPMorgan Chase & Co. with the idea of leveraging a consumer’s existing relationship with a bank to initiate peer-to-peer payments. Capital One Financial Corp. became the fourth owner in 2014. Lakewood, Colo.-based FirstBank joined clearXchange in 2013, but is not an owner. It launched its clearXchange-based P2P app in December 2014.

“Digital person-to-person payments are far more convenient than writing a check or having enough cash on hand to pay the babysitter or split a rent payment,” Gareth Gaston, U.S. Bank executive vice president of omnichannel banking, said in a press release. “By joining with clearXchange, U.S. Bank customers have a better way to make those payments quickly, easily, and safely.”

U.S. Bank, which did not immediately respond to inquiries from Digital Transactions News, does not provide in its release a date for when the bank will begin using clearXchange’s service. The bank only says it “will take place in the future.”

ClearXchange’s wrangling of several large banks is a positive move for the P2P network, says Thad Peterson, a senior analyst at Boston-based Aite Group LLC. “They’re starting with a critical mass of customers,” Peterson says. ClearXchange says its banks represent more than 100 million online-banking consumers.

“The big question is whether or not that kind of P2P transfer is competitive with a Venmo,” Peterson tells Digital Transactions News. Venmo is a P2P service managed by PayPal Inc.’s Braintee unit. Venmo has enjoyed a lot of success with college students and slightly older consumers in particular. Observers say services like clearXchange may struggle to attract younger users who have adopted Venmo.

Peterson says banks will need to focus on attracting older consumers, outside of the so-called Millennial generation. “Venmo has quite a cachet and customer base,” he says.

A clearXchange spokeswoman says some owners are using the service, and others are either in the process of implementing or “fully rolling it out to their customer base.” She would not say which banks are still in planning stages or launching the service.