How Does Zelle App Work & Make Money? Business Model

Updated 06 Jan 2024
Published 15 Mar 2022
Gaurav Sharma 4373 Views
Zelle Business Model

Are you wondering How Zelle makes money? The leading peer-to-peer payment network allows its users to send money instantly to friends and family. In this blog, we will explain everything about the Zelle business model and how it earns revenues. 

Business Overview

Zelle is a popular peer-to-peer (P2P) payment network that enables users to send money to friends, family, and others who are part of the existing platform. 

Currently, Zelle is not making any money. On the other hand, its participating banks generate revenues whenever a user pays the business in exchange for products or services.

Zelle peer to peer payment app report
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The Zelle network came into existence in 2017. Currently, it boasts the presence of as many as 924 participating banks within its network. For the fiscal year 2020, the company had managed to facilitate around $307 billion in terms of overall payments. 

What is the role of Zelle Payment App?

Zelle is a leading P2P payment service provider that helps support transactions between different users of the platform. The company is owned by Early Warning Services. It is a private financial service organization.

Early Warning Services, in turn, is owned by the Bank of America, Capital One, BB&T, JP Morgan Chase, Wells Fargo, US Bank, and PNC Bank. 

With Zelle, users of the platform are allowed to send overpayments or ensure money transfers directly from the bank account. There is no requirement for bank wires or third-party involvement. Once the users have completed the instant registration and login processes, they are capable of downloading the app.

Then, they can use the app to send money to different platforms, like Venmo, and PayPal, directly. Other users should also be registered on the Zelle network. The services offered by Zelle are only available to bank account holders in the United States of America.

Zelle Business Model
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The Zelle payment network is also made available within the respective partner bank applications. These include the apps by Wells Fargo and Chase. Users who wish to transfer money using the platform of Zelle, are expected to enter the contact number and email address of the receiver.

Transactions within the P2P network are quite instant. The funds that are transferred get reflected in the account of the recipients within minutes. 

Currently, Zelle is known to work with around 924 participating banks and financial institutions. Most of the partnered banks of Zelle feature integrated payment platforms within their respective apps.

Therefore, if any user has access to a Visa Debit or Credit Card or a Mastercard, it becomes easier to transfer money with the help of the Zelle platform.

How Does Zelle Work and Make Money?

Initially, Zelle came into the market in the form of ClearXchange. It was founded in 2011 by different partners including JP Morgan Chase, Bank of America, and Wells Fargo.

However, Zelle served to be the ultimate answer of the banking industry to the utilization of famous payment apps including PayPal and Venmo. However, just after its launch, Zelle came forward to be a somewhat clunky and slow interface.

Zelle Make Money App
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In some cases, the users complained that the app took around 5 days to complete the processing of payment while reflecting the same in the receiver’s account. Only a few banks had started working with the platform. Zelle only used to work with the apps of the partner banks. 

In 2016, the company went ahead with changing its perspective.  The banking consortium went ahead to sell the respective app to Early Warning. It was owned by yet another banking consortium.

Early Warning continued putting ample development work into the app for meeting the ever-increasing needs of the market. Eventually, the app was rebranded to Zelle. During its launch in 2017, Zelle came forth with around 30 banking partners within the network.

Due to this, the app managed to earn around 100 million users almost instantly. This enabled the rapid adoption of the service provider in the market of retail payment applications.

The warning continued engaging in intense marketing campaigns. It even went ahead with spending as much as $1 million for a single TV advertisement for promoting the Zelle app.

Mobile Payment App Development

Towards simplifying the overall user experience and user interface of the app, Early Warning took the step of standardizing its overall platform interface and offerings across all banking institutions.

During the early days of the platform, the app revealed ample growth in the baby boomer and millennial markets. 

Since the facilitation of the process of digital payments took place within the app, there was no more requirement of migrating outside the bank account.

Therefore, Zelle ended up gaining immense popularity for the overall ease of use and app security. Only after two years of the launch of the application, Zelle go ahead with claiming the topmost position as an industry leader in the market of P2P payments.

Working of the Zelle App

Zelle is a pioneering digital payment platform that enables the participating users to transfer money directly from their respective bank accounts to any other member of the given platform.

The service is made available only to the account holders of the United States of America. The registration takes only a few minutes to get completed. 

Once the users are registered, they can easily send money to friends and family members with the help of the Zelle app. At the same time, the Zelle network can also be utilized within the application of some partner banks like JP Morgan Chase and Wells Fargo.

Zelle payment app
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For transferring the money with the app, users are only expected to enter the contact number and email address of the desired recipient. The funds usually get transferred within some minutes with the help of the app.

The network of Zelle is currently made available only to consumers. Therefore, businesses are expected to make use of other ways for ensuring the collection of payments. 

Zelle is powered by Visa Direct and Mastercard Send payment rails. Modern-day banking mechanisms usually make use of both the payment rails and the payment processors.

Therefore, basically, any banking network is allowed to be a part of the Zelle Network.

Some of the simple steps to follow with Zelle for transferring money are:

  • Launch the Zelle app on your smartphone
  • Log in to the respective Zelle account using your credentials 
  • Select the option ‘Send Money’
  • Choose the person or contact number for transferring money
  • Enter the valid Email ID of the desired recipient
  • Enter the amount and select the option Next
  • Fill the box ‘What’s this for?’ and enter a valid reason
  • Click the Send button as you complete the transfer process

Read Also: – Growing Importance of App Development in Today’s Scenario

How Does Zelle Make Money?

Currently, Zelle is not making any money. During the days of ClearXchange, the participating banks of the platform tried imposing fees on the platform for every mode of payment.

Eventually, the plans were closed instantly due to the rise of other services like Square Venmo and Cash app. These services were known to be free of cost -right from the start. 

Top Zelle payment app alternatives

In the coming future, Zelle is supposed to be available for free of any charges. This is because the participating banks of the network are required to retain the customers.

At the same time, they are also expected to safeguard themselves against competitors like Venmo, Chime, and others.

In 2018, Zelle went ahead with launching a feature that enabled its users to pay businesses for a wide range of products and services.

In the given case, merchants will be paying around 1 percent payment processing fee to Visa or Mastercard. The given revenue is eventually shared with the bank that is responsible for issuing the card.

Some of the additional sources of app monetization for Zelle include the launch of Zelle-branded credit or debit cards. Businesses can also consider promoting other financial products with the help of the Zelle app. This will allow the platform to earn money with the help of affiliate commissions.

Early Warning Services -the company behind the working of Zelle, is another platform for exchanging money from the participating banks.

In turn, they do the work of developing and maintaining the Zelle app. However, as stated above, the Zelle app itself is not capable of earning any revenue for the mother company.

Scope for Future Growth of Zelle

Zelle continues growing and advancing at a rapid rate. Particularly within the United States population, the app continues moving toward the scope of digital services for ensuring payments.

The overall convenience offered by Zelle through the bank account of the user makes it an impressive and convenient competitor in the industry. 

Peer to Peer Mobile Payment
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It is estimated that over 100,000 individuals in the United States of America sign up for Zelle and its services on a daily basis. The user base of the company is accelerating at an amazing average of around 15 percent per quarter at the ongoing moment. Therefore, it is clear that the genuine winners with the Zelle app tend to be the participating banks. 

One of the major benefits of using the Zelle app is that it is the only application out there that is linked directly to the bank account of the users.

Therefore, it helps in offering a seamless way of transferring money without the requirement of creating wire transfers. Due to this, in 2020, the company managed to obtain around $12 billion worth of transactions for an aggregate value of $307 billion.

Another important benefit of using Zelle is the overall ease of using payment apps like Venmo & PayPal.  Moreover, the platform also delivers ample support to the users. Before launching Zelle, a number of participating banks revealed a major low in the overall demand for money transfers.

Zelle offers access to convenient services to individuals having bank accounts. Moreover, it also helps in adding a new product that helps in increasing trust and public awareness within the conventional banking system. 

Competitors of Zelle

Zelle is known to compete with other service providers in the modern peer-to-peer payment scenario. However, no other service provider offers its customers a direct link to the respective bank account wherein users are capable of seamlessly transferring funds to third parties. Some of the leading competitors of Zelle in the modern space are:

Top Zelle payment app alternatives


Delivering point-of-sale payment solutions and merchant services along with the ease of P2P payments with the help of the Cash app of Square.


It is a famous subsidiary of PayPal that offers access to money transfers and debit cards with the help of the P2P model.

Apple Pay:

Delivers mobile-enabled payments through Apple devices. 


It is a pioneering payment system delivering support for online money transfers.

Google Pay:

It is a leading online payment system and digital wallet platform -primarily meant for Android devices. 

Receiving Money with Zelle

If you are on the receiving end of the Zelle app, the process of receiving funds is simple and seamless as well. If you have opened a Zelle account of your own, you are not required to do anything to receive the payments.

Zelle mobile app standards
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This is because the desired amount of money will be directly transferred to your bank account. However, if you are not registered with Zelle, then you should consider opening an account with Zelle to receive money. Here are some steps to follow:

  • Open your email ID and select the provided link in your payment notification
  • Choose the Credit Union or bank
  • Follow the on-screen instructions to receive the desired payments

If your Credit Union or bank is not allowing Zelle, then you can go ahead with downloading the Zelle app on your smartphone. Then, you can open an account for receiving payments with the app. For this, you need to enroll in the app with the help of your credit or debit card.

Hire Mobile App Developer

Wrapping up 

If you wish to develop a Zelle-like payment app, you can hire services from a reliable mobile app development company to get you through with your idea of a Zelle-like application.

Create your own credible space in the peer-to-peer segment following the Zelle mobile app standards and applying the best application resources and features to get you through with your share of P2P excellence.

Gaurav Sharma

Gourav Sharma is a Digital Marketing Strategist at Arka Softwares, a leading web development company. He has 2 years of experience in the Information Technology industry. He spends his time reading about new trends in Digital Marketing and the latest app development technologies.

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