Payments Network clearXchange Gets Reboot

Some of the country's biggest banks are rebooting a venture to make it easier for consumers to send money to each other electronically.

PNC Financial Services Group Inc. and BB&T Corp. are joining clearXchange, a person-to-person payments network. The venture already includes Bank of America Corp., Capital One Financial Corp., First Bank, J.P. Morgan Chase & Co., U.S. Bancorp and Wells Fargo & Co.

Launched in 2011, clearXchange lets people use their checking accounts to send each other money with an email address or cellphone number. Customers of the service can send funds to anyone with a U.S. bank account.

The payment service is also expanding its ability to transfer funds immediately for all transactions. Currently, only customers who send money from one bank to another account at the same bank have instant access to the funds; transactions between different banks take a day to clear.

In addition to the new bank members, clearXchange's structure is being overhauled. The network, which is owned by five big banks, will be owned by Early Warning, another bank-owned entity that specializes in fraud prevention and risk management.

The expansion is the latest sign that banks want to keep a tight grip on their customers at a time when third-party providers are cropping up in financial services.

"We want to keep the banks at the center of the customers' financial life," said Michael Kennedy, clearXchange's chief executive.

ClearXchange has fallen short of some expectations, in part because it has been eclipsed by other person-to-person payment schemes like Venmo, a unit of PayPal Holdings Inc., according to people familiar with its operations.

Mr. Kennedy said the service is growing and transaction sizes are getting larger as customers become more comfortable with zapping money to each other.

"We think that, versus any other company, we're experiencing comparable if not higher growth rates and volumes," he said in an interview.

Write to Robin Sidel at [e-mail]

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(END) Dow Jones Newswires

October 26, 2015 13:45 ET (17:45 GMT)

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