BofA Turns On clearXchange P2P Service; Chase Next

Sorry, PayPal, banks are pushing ahead with their P2P payment strategies.

Bank of America Corp. officially rolled out its clearXchange service yesterday, a move that the nation’s second-largest bank by assets says enhances its already existing banking P2P transfer service.

ClearXchange is an open payment processing network by BofA, JP Morgan Chase and Wells Fargo & Co. In May, Wells Fargo nationally introduced the service to its customer. Chase tells Bank Innovation it will roll out the service later this year.

With BofA unlocking the service, customers can now make transfers to other U.S.-based bank accounts by an email address or mobile phone number without any fees. The new service has launched for the bank’s iPad, iPhone, Google Android, smartphone or tablet, Kindle Fire and Windows phone app.

Though banks are late to P2P efforts, industry experts say consumers prefer to transact through their banks. Plus, the move by the major banks points to how FIs plan to grab more of the P2P market.

“Banks do have an advantage when it comes to P2P, and clearXchange is part of it,” Jeff Crawford, senior consultant at First Annapolis Consulting, tells Bank Innovation.

In its 2012 Person-to-Person Payments Study report published this month, First Annapolis forecasts that mobile P2P payments are expected to grow to more than $50 billion by 2017.

Beyond improving the way in which its customers can pay other people, BofA announced a number of other new mobile services like more robust account alert management, including the option to receive push notifications and mobile RDC.

Bank of America first released its iPhone and iPad mobile apps in 2007. The bank has more than 10 million customers using mobile banking, which is a 6% increase from the prior quarter and up 34% from the year-ago period, according to data the bank released this month.