8 ms·

What are Zelle transfer?

ceejayoz 4y ago
Instant, no-fee, irreversible transfer between participating US bank accounts. (Like most of the rest of the world has had for a decade or more, but it's new, and because it's new and there's very little education to consumers from the banks it's heavily used in scams. It also has a pretty confusing UX that lends itself to scams.)
- alistairSH 4y ago
  It’s also a owned by the 5-6 largest consumer banks in the US (BofA, CapOne, etc). So, they’re complicit in allowing the fraud to continue.
  - fshbbdssbbgdd 4y ago
    What should the banks do to prevent scams?
    - timerol 4y ago
      Allow reversing transactions that are proven to be scams, as they are required by law to do. https://www.investopedia.com/terms/r/regulation-e.asp https://www.investopedia.com/terms/r/regulation-e.asp
      - snotrockets 4y ago
        They can not disallow doing that (as you wrote, they are required to), but they do make it very hard, because they are unwilling to put up the cost. However, the regulator mandates they should: what needs to be done is make sure they are always taken to task, and that the task is extremely easy to perform.
    - ceejayoz 4y ago
      Ditch the patchwork nature of it, for starters. See the Zelle "getting started" page at https://www.zellepay.com/get-started https://www.zellepay.com/get-started - there's no solid set of instructions because there's almost two thousand different implementations of it. Your bank's procedure may be entirely different than mine's; if your bank doesn't support it it's a different procedure alltogether. As a result, scammers can fairly easily convince someone who's never or infrequently used it that their process (usually with a phished website posing as Zelle) is legit. The "it's a banking technology, but it's also a website and an app, maybe, it depends" thing doesn't help.
      - thrwy_918 4y ago
        Zelle is also built around the idea that each identity will be connected to exactly one bank account, which is very irritating.
        krferriter 4y ago
        It was pretty wild when I logged into one of my other bank accounts and it said I could not use Zelle with that account because I already had Zelle linked to a different bank account. So I had to unlink it from the other account first. Isn't it common for people to have more than one bank account, and wasn't this the case when Zelle was developed, relatively recently? Why did this use case not cross their mind when they developed it?
        alistairSH 4y ago
        LOL. That's insane. Is it one Zelle link, period? Or only to one bank (but you could link several accounts from that one back)?
        thrwy_918 4y ago
        >Is it one Zelle link, period? I believe a single Zelle identity can only be linked to a single bank account, and a Zelle identity consists of an email address, phone number or both. Typically it's the "both" option, but I think that in theory you could create multiple identities with multiple email addresses, and link each to a separate bank account
    - jabroni_salad 4y ago
      You can never really prevent scams, it is what it is. However, they need to keep a paper trail and reverse bad transactions. If someone impersonates me or steals my debit card, they can do a bad ATM withdrawal and get cash. That can be reversed, but for some reason once Zelle is in the picture everything is written in stone.
      - sowbug 4y ago
        Just to be clear, Zelle's irrevocability doesn't legitimize criminal acts or fraud. It just means your bank won't help you untangle the mess. It's rare that a lawsuit against a fraudster or thief goes anywhere, but depending on the amount lost, it can be worth it to obtain a default judgment, which can typically be collected for 10 years. If you can identify the person or entity that took your money, they might eventually have enough assets for you to collect.
  - raincom 4y ago
    Use Zelle to transfer to the people you know--that's the intended purpose of Zelle. If you are buying a service/product, use credit cards or PayPal.
    - snotrockets 4y ago
      Or remind the banks that regulation E puts the responsibility of fraud (minus $50) on them. US banks got scared by money transfer apps, and decided they want to provide a similar service, at no cost to customers, and minimal cost to them. Of course, they can't have it all, and now they try to put some costs they are not allowed to, onto their customers.
  - riffic 4y ago
    lol, bofa.
- bityard 4y ago
  Instant and no-fee I can get behind but irreversible sounds like an awesome way to lose a lot of money.
  - notch656c 4y ago
    Reversibility means risk incurred on the transfer system which means not free. Reversibility to the people you pay also means you pay a premium as the vendor has to self or externally insure the risk the funds will be recalled.
  - wintermutestwin 4y ago
    I've seen it IRL. Zelle claims no responsibility and that they can't track what they sent.
    - salawat 4y ago
      Fines for failure to implement legally mandated Anti-Money Laundering measures in 3...2...1... Seriously. If they can't, it will not be long until the omission is noticed.
  - plsbenice34 4y ago
    I only ever worry of the opposite: reversibility leading to chargeback scams.
- jesprenj 4y ago
  > most of the rest of the world has had for a decade or more What specific system are you implying? In Slovenia, I can't make a bank transfer online when my bank is closed (at night). Money transfer between banks costs me 40 cents per transaction and international transfer in the EU costs me around 7 €. Maestro card is instant and free and works even when the bank is closed, but it is only used for spending money. I don't pay any fees for my bank account, since I'm younger than 27.
  - watermelon0 4y ago
    EU countries (and a few others) are part of SEPA, where we have SEPA Instant Payments, which offer instant payments between bank accounts, 24/7. Price depends on the bank (and the type of bank account you have), but it's about 1 EUR or less. --- Many countries also have local payment systems, that are usually limited to a single country. For example, in Slovenia, we have Flik Pay, which allows sending money between individuals via mobile app, without any fees, and it also works 24/7.
    - jesprenj 4y ago
      I see - probably the Nujno (urgent) checkbox on a SEPA form activates this SEPA instant payment. I know about Flik and I like the appeal of it, but I do not use it because it requires a proprietary client (NLB Pay in my case). Do you know of any public or reverse engineered specification or unofficial FOSS client?
  - newaccount74 4y ago
    > international transfer in the EU costs me around 7 € Are you sure about that? I thought with SEPA all Euro transfers within the EU have to be the same fee as national transfers, which is free for almost all consumer bank accounts in Austria. My bank charges for instant transfers on my business account (around 8€), but other than that all transfers are free.
    - jesprenj 4y ago
      You are right, I verified this now. EU payments cost me the same amount as domestic payments. The ~7 € charge I remember was probably due to conversion. I wanted to send money to Croatia, which at the time did not use Euro yet.
- baby 4y ago
  It’s also limited to 2k a day
  - ceejayoz 4y ago
    The limit is up to each participating bank.
    - TedDoesntTalk 4y ago
      My bank varies the limit for me each day. Sometimes I can’t transfer $1000. Sometimes I can. Once I tried to transfer $3000 over many different days. No way. Can’t do it. Customer service says the limited cannot be raised past a certain point. And they won’t tell me what the limit is.
    - baby 4y ago
      Ah interesting, well with Chase it's $2k which is quite annoying
- cle 4y ago
  > irreversible transfer Apparently they're not irreversible...
  - ceejayoz 4y ago
    They're irreversible, except "unauthorized" transactions. Most scammers generate authorized transactions via trickery. Banks won't accept "I was tricked" as "unauthorized"; they only count cases of actual account compromise, and even there... https://www.cnn.com/2022/10/03/business/nightcap-zelle-fraud-warren-investigation/index.html https://www.cnn.com/2022/10/03/business/nightcap-zelle-fraud... > The bank data reviewed by Warren’s office suggest even the bulk of unauthorized cases are going unpaid. For example: PNC Bank indicated that its customers reported 10,683 cases of unauthorized payments totaling over $10.6 million. It refunded only 1,495 cases, totaling $1.46 million.
    - snotrockets 4y ago
      It doesn't matter what banks accept; they are required to by the regulator. That they try to weasel out of it just means they need to be regulated harder and at more cost to the executive suit.
      - ceejayoz 4y ago
        > It doesn't matter what banks accept; they are required to by the regulator. Regulation E (https://www.consumerfinance.gov/rules-policy/regulations/1005/2/#j https://www.consumerfinance.gov/rules-policy/regulations/100...): "'Unauthorized electronic fund transfer' means an electronic fund transfer from a consumer's account initiated by a person other than the consumer without actual authority to initiate the transfer and from which the consumer receives no benefit." How is "I willingly initiated a transfer to someone who turned out to be a scammer" within this definition?
        snotrockets 4y ago
        Competent (non-software) professionals would read the initiation as the intent, also see comment 4 there, suggesting the mindset of the regulator. As a reminder, regulations are always subject to the interpereation of the regulator, which, as history shows in the case of regulation E, tends to side with the consumers. There's a deeper story here though: * Banks are given a monopoly to almost literally print money. We ceded control of a very important facet of daily lives to them. * The cost for that is tight regulation, meant to make sure they keep the trust invested in them. * In the case of Zelle, and some other new products, banks, rushing to market, try to ignore their side of the deal. * Suggesting we should give up and accept that is morally, regulatory, and legally wrong. * Regulators and policy makers seem to agree with the above.
- imtringued 4y ago
  SEPA instant payments are pretty new but yeah even Europe has that now.
  - kergonath 4y ago
    Even before instant transfers, standard SEPA was quick and easy. The big step forward was when they let us add beneficiaries from a phone app or a website rather than by sending verification codes over snail mail, but that was a while ago now.
- Semaphor 4y ago
  From everything I heard, the system in Germany/Europe is better than ACH, but instant interbank transfers are only a few years old, and usually are not feeless.
- pxx 4y ago
  "Instant" is wrong. I've had successful Zelle transfers take upwards of 60 minutes to clear without any sort of confirmation of progress. It's a real pain.
- snotrockets 4y ago
  It isn't irreversible. No bank transfer is.

Instant, no-fee, irreversible transfer between participating US bank accounts. (Like most of the rest of the world has had for a decade or more, but it's new, and because it's new and there's very little education to consumers from the banks it's heavily used in scams. It also has a pretty confusing UX that lends itself to scams.)

alistairSH 4y ago
It’s also a owned by the 5-6 largest consumer banks in the US (BofA, CapOne, etc). So, they’re complicit in allowing the fraud to continue.
- fshbbdssbbgdd 4y ago
  What should the banks do to prevent scams?
  - timerol 4y ago
    Allow reversing transactions that are proven to be scams, as they are required by law to do. https://www.investopedia.com/terms/r/regulation-e.asp https://www.investopedia.com/terms/r/regulation-e.asp
    - snotrockets 4y ago
      They can not disallow doing that (as you wrote, they are required to), but they do make it very hard, because they are unwilling to put up the cost. However, the regulator mandates they should: what needs to be done is make sure they are always taken to task, and that the task is extremely easy to perform.
  - ceejayoz 4y ago
    Ditch the patchwork nature of it, for starters. See the Zelle "getting started" page at https://www.zellepay.com/get-started https://www.zellepay.com/get-started - there's no solid set of instructions because there's almost two thousand different implementations of it. Your bank's procedure may be entirely different than mine's; if your bank doesn't support it it's a different procedure alltogether. As a result, scammers can fairly easily convince someone who's never or infrequently used it that their process (usually with a phished website posing as Zelle) is legit. The "it's a banking technology, but it's also a website and an app, maybe, it depends" thing doesn't help.
    - thrwy_918 4y ago
      Zelle is also built around the idea that each identity will be connected to exactly one bank account, which is very irritating.
      - krferriter 4y ago
        It was pretty wild when I logged into one of my other bank accounts and it said I could not use Zelle with that account because I already had Zelle linked to a different bank account. So I had to unlink it from the other account first. Isn't it common for people to have more than one bank account, and wasn't this the case when Zelle was developed, relatively recently? Why did this use case not cross their mind when they developed it?
        alistairSH 4y ago
        LOL. That's insane. Is it one Zelle link, period? Or only to one bank (but you could link several accounts from that one back)?
        thrwy_918 4y ago
        >Is it one Zelle link, period? I believe a single Zelle identity can only be linked to a single bank account, and a Zelle identity consists of an email address, phone number or both. Typically it's the "both" option, but I think that in theory you could create multiple identities with multiple email addresses, and link each to a separate bank account
  - jabroni_salad 4y ago
    You can never really prevent scams, it is what it is. However, they need to keep a paper trail and reverse bad transactions. If someone impersonates me or steals my debit card, they can do a bad ATM withdrawal and get cash. That can be reversed, but for some reason once Zelle is in the picture everything is written in stone.
    - sowbug 4y ago
      Just to be clear, Zelle's irrevocability doesn't legitimize criminal acts or fraud. It just means your bank won't help you untangle the mess. It's rare that a lawsuit against a fraudster or thief goes anywhere, but depending on the amount lost, it can be worth it to obtain a default judgment, which can typically be collected for 10 years. If you can identify the person or entity that took your money, they might eventually have enough assets for you to collect.
- raincom 4y ago
  Use Zelle to transfer to the people you know--that's the intended purpose of Zelle. If you are buying a service/product, use credit cards or PayPal.
  - snotrockets 4y ago
    Or remind the banks that regulation E puts the responsibility of fraud (minus $50) on them. US banks got scared by money transfer apps, and decided they want to provide a similar service, at no cost to customers, and minimal cost to them. Of course, they can't have it all, and now they try to put some costs they are not allowed to, onto their customers.
- riffic 4y ago
  lol, bofa.
bityard 4y ago
Instant and no-fee I can get behind but irreversible sounds like an awesome way to lose a lot of money.
- notch656c 4y ago
  Reversibility means risk incurred on the transfer system which means not free. Reversibility to the people you pay also means you pay a premium as the vendor has to self or externally insure the risk the funds will be recalled.
- wintermutestwin 4y ago
  I've seen it IRL. Zelle claims no responsibility and that they can't track what they sent.
  - salawat 4y ago
    Fines for failure to implement legally mandated Anti-Money Laundering measures in 3...2...1... Seriously. If they can't, it will not be long until the omission is noticed.
- plsbenice34 4y ago
  I only ever worry of the opposite: reversibility leading to chargeback scams.
jesprenj 4y ago
> most of the rest of the world has had for a decade or more What specific system are you implying? In Slovenia, I can't make a bank transfer online when my bank is closed (at night). Money transfer between banks costs me 40 cents per transaction and international transfer in the EU costs me around 7 €. Maestro card is instant and free and works even when the bank is closed, but it is only used for spending money. I don't pay any fees for my bank account, since I'm younger than 27.
- watermelon0 4y ago
  EU countries (and a few others) are part of SEPA, where we have SEPA Instant Payments, which offer instant payments between bank accounts, 24/7. Price depends on the bank (and the type of bank account you have), but it's about 1 EUR or less. --- Many countries also have local payment systems, that are usually limited to a single country. For example, in Slovenia, we have Flik Pay, which allows sending money between individuals via mobile app, without any fees, and it also works 24/7.
  - jesprenj 4y ago
    I see - probably the Nujno (urgent) checkbox on a SEPA form activates this SEPA instant payment. I know about Flik and I like the appeal of it, but I do not use it because it requires a proprietary client (NLB Pay in my case). Do you know of any public or reverse engineered specification or unofficial FOSS client?
- newaccount74 4y ago
  > international transfer in the EU costs me around 7 € Are you sure about that? I thought with SEPA all Euro transfers within the EU have to be the same fee as national transfers, which is free for almost all consumer bank accounts in Austria. My bank charges for instant transfers on my business account (around 8€), but other than that all transfers are free.
  - jesprenj 4y ago
    You are right, I verified this now. EU payments cost me the same amount as domestic payments. The ~7 € charge I remember was probably due to conversion. I wanted to send money to Croatia, which at the time did not use Euro yet.
baby 4y ago
It’s also limited to 2k a day
- ceejayoz 4y ago
  The limit is up to each participating bank.
  - TedDoesntTalk 4y ago
    My bank varies the limit for me each day. Sometimes I can’t transfer $1000. Sometimes I can. Once I tried to transfer $3000 over many different days. No way. Can’t do it. Customer service says the limited cannot be raised past a certain point. And they won’t tell me what the limit is.
  - baby 4y ago
    Ah interesting, well with Chase it's $2k which is quite annoying
cle 4y ago
> irreversible transfer Apparently they're not irreversible...
- ceejayoz 4y ago
  They're irreversible, except "unauthorized" transactions. Most scammers generate authorized transactions via trickery. Banks won't accept "I was tricked" as "unauthorized"; they only count cases of actual account compromise, and even there... https://www.cnn.com/2022/10/03/business/nightcap-zelle-fraud-warren-investigation/index.html https://www.cnn.com/2022/10/03/business/nightcap-zelle-fraud... > The bank data reviewed by Warren’s office suggest even the bulk of unauthorized cases are going unpaid. For example: PNC Bank indicated that its customers reported 10,683 cases of unauthorized payments totaling over $10.6 million. It refunded only 1,495 cases, totaling $1.46 million.
  - snotrockets 4y ago
    It doesn't matter what banks accept; they are required to by the regulator. That they try to weasel out of it just means they need to be regulated harder and at more cost to the executive suit.
    - ceejayoz 4y ago
      > It doesn't matter what banks accept; they are required to by the regulator. Regulation E (https://www.consumerfinance.gov/rules-policy/regulations/1005/2/#j https://www.consumerfinance.gov/rules-policy/regulations/100...): "'Unauthorized electronic fund transfer' means an electronic fund transfer from a consumer's account initiated by a person other than the consumer without actual authority to initiate the transfer and from which the consumer receives no benefit." How is "I willingly initiated a transfer to someone who turned out to be a scammer" within this definition?
      - snotrockets 4y ago
        Competent (non-software) professionals would read the initiation as the intent, also see comment 4 there, suggesting the mindset of the regulator. As a reminder, regulations are always subject to the interpereation of the regulator, which, as history shows in the case of regulation E, tends to side with the consumers. There's a deeper story here though: * Banks are given a monopoly to almost literally print money. We ceded control of a very important facet of daily lives to them. * The cost for that is tight regulation, meant to make sure they keep the trust invested in them. * In the case of Zelle, and some other new products, banks, rushing to market, try to ignore their side of the deal. * Suggesting we should give up and accept that is morally, regulatory, and legally wrong. * Regulators and policy makers seem to agree with the above.
imtringued 4y ago
SEPA instant payments are pretty new but yeah even Europe has that now.
- kergonath 4y ago
  Even before instant transfers, standard SEPA was quick and easy. The big step forward was when they let us add beneficiaries from a phone app or a website rather than by sending verification codes over snail mail, but that was a while ago now.
Semaphor 4y ago
From everything I heard, the system in Germany/Europe is better than ACH, but instant interbank transfers are only a few years old, and usually are not feeless.
pxx 4y ago
"Instant" is wrong. I've had successful Zelle transfers take upwards of 60 minutes to clear without any sort of confirmation of progress. It's a real pain.
snotrockets 4y ago
It isn't irreversible. No bank transfer is.