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Tech Articles

Zelle is Venmo’s Worst Enemy

Tech
Jun 19, 2017

Zelle is Venmo’s Worst Enemy

BY: BENJAMIN "BENJI" KARMIS

The emergence of Venmo has been a major disruptor in terms of how we transfer money. In case you’re technologically challenged and unfamiliar with the mobile app, it is a great way to shift funds from your bank to another. It’s an easy way to pay back a friend or even pay rent with, which explains its explosive growth since it’s inception in 2012. In the fourth quarter of 2016 alone, the system reported $5.6 billion in payment volume. But where success is found, competitors arise, so will the much-anticipated app Zelle be able to steal some of Venmo’s notoriety?

Venmo is so popular that it has grown into a verb: “I’ll venmo you” is a common phrase among the millenial class.  What makes Venmo so successful is that it is so easy to use. Just pop in some details and BAM, you don’t need to go to an ATM much anymore. Paired with a compulsory witty reason for your payments on a feed your friends can see, Venmo offers just a hair of customization that further attracts us users.
As we’ve seen with Instagram copying Snapchat’s stories, competitors are quick to mimic success, and the app Zelle will be out on the hunt for Venmo blood. What Zelle has over Venmo is the support of over 30 U.S. banks. Banks have been anticipating Zelle to the point that your phone could likely have Zelle on it before you are even aware. The new transferring system has a unique integration in that it isn’t being released as a stand-alone app , but as an update to major banks’ apps.

Probably our biggest issue with Venmo is that it takes days to get your money transferred to your bank, whereas Zelle only takes a matter of minutes. And if you try to pay someone who doesn’t have the Zelle app, all you would need is their email or phone number to digitally grant them your funds. You also wouldn’t have to stress about finding your friends’ usernames. Personally, we’ve have had to ourselves up on our doofus mates’ phones before because s they decide to create a cheeky username. That would be completely avoidable when using Zelle.

Even so, Zelle’s biggest strength could be its biggest problem. The integration of Zelle to your phone may fumble because if you didn’t know about Zelle, you might brush right past it. Think of those bloatware apps that carriers clutter up your phone with. I have no idea what AT&T Live does, and I’m just not curious enough to find out. Besides that, it will take 12 months for all of the supporting banks to integrate Zelle (if they even support your bank), which would be problematic if you’re trying to “Zelle” someone money who doesn’t have the app. “What? Why can’t you just Venmo me?”

However, the puppet master behind the Venmo app, Paypal, is a lurking variable. Paypal already allows you to send money to others with just an email address or phone number, and there will be funding through big brother Paypal for Venmo to further mirror Zelle depending on its success.

So how worried should Venmo be, then? Truthfully, it’s hard to tell this early in the game. Zelle has some interesting features, but Venmo has the early game advantage, and we the people don’t always react well to change. But if Zelle catches on, it could be dangerous because it would be a pretty obvious choice which app a new user would go with – do you want to give your bank information to some random app, or just go through a program literally already on your bank’s app? Zelle has features Venmo will have trouble copying, so if the apps ever grow to similar sizes, Zelle might just emerge as the victor, unless Paypal reacts accordingly. If Venmo ever does fall, we’ll forever miss its funny feed.