With more businesses adopting contactless payment methods, digital payment offers a number of advantages over traditional paper checks and cash. Zelle, a mobile payment processor, transfers money in minutes from one person’s or business’s bank account to another. For small businesses, being able to transfer money rapidly with minimal to no costs can be a game-changer. With minimal work on your part, you can provide convenience to your customers. Plus, whether you run an e-commerce or brick-and-mortar store, digital payments allow you to accept and transmit money at any time. While you’re certainly familiar with Apple Pay and PayPal as NFC mobile payment providers, you may still be learning the ropes with Zelle. So, let’s go over the fundamentals of Zelle, a digital payment platform.
What is Zelle?
Early Warning Services created Zelle in 2016, with headquarters in Scottsdale, Arizona. Users can send and receive money using simply the recipient’s mobile phone number or email address using its U.S.-based peer-to-peer (P2P) and business-to-business (B2B) mobile services. Zelle has partnered with almost 500 financial institutions. However, in order for your business to use Zelle, your financial institution must provide it as an option for your business account type. (Either through their bank or the Zelle app, anyone can utilise the Zelle individual P2P service.)
Zelle is a service that helps businesses and people cut down on the quantity of paper checks and cash transactions they do. Zelle mobile transactions allow customers to pay instantly, and Zelle can immediately remind customers who haven’t paid. Zelle exchanged hundreds of billions of dollars in 2021 alone, thanks to increasing acceptance by small enterprises and increased consumer use.
How Does Zelle for Business Work?
Zelle was solely used for P2P transactions before 2016. However, all that changes when they decided to expand to the B2B market. The B2B expansion enabled it to market to the business owners and help them establish a checking or savings account. This allowed them to use Zelle through their financial institutions or through the app itself. Hence, it is important to discuss the pros and cons of the app.
Advantages and Disadvantages of Zelle
- You get paid right away, with no need for a routing number.
- Regardless of the day or time, payment hits your bank account faster than it would with PayPal or Venmo.
- If you utilise a checking account, there are no costs.
- It’s a simple way to make no-contact payments.
- For stress-free bookkeeping, you can categorise your digital payments.
- All transactions through the app will require both the interacting parties to have Zelle app installed in their systems.
- Debit card transactions are not allowed.
- Purchase protection is also switched off.
- Refunds for purchases will have to be carried out through a different payment method.
- Zelle is incompatible with international banks.
Safety and Security Concerns
As Zelle does not use paper checks or cash, payments can be made instantly from one account to another. It also doesn’t keep transaction data on the servers of users. Instant payment, on the other hand, isn’t flawless. If you send a payment to the wrong individual, you can only file a chargeback if the charge appears as a pending transaction and you contact your bank promptly, or if the recipient does not have a Zelle account. If you successfully cancel the transaction, you may have to wait up to 14 days to receive your money back (if the recipient does not have a Zelle account).
At the time of writing, the app does not charge any fees for its services. However, since banks can set transaction limits, Zelle could start charging for its services.
Account Set Up Process
To begin using Zelle for business, make sure you have a bank account that qualifies. You’ll need a suitable business checking account and a credit card at the very least (a debit card is not accepted). If your bank doesn’t provide Zelle as a payment option on its mobile app or website, you’ll have to go to the Zelle website and download the app (on either iOS or Android). To link your Zelle business account, choose an email address and a phone number. This email address and phone number must be different from those on your personal account. While this will add another login to your list of things to remember, Zelle is helping you out by keeping your personal and commercial activities distinct.
You’ll need the customer’s email address or phone number to create or receive a transaction. Transactions are automatic, similar to PayPal and Venmo for Business, and there is no requirement for a routing number. Then, using your bank’s or Zelle’s app, you may send and receive money and split bills with ease.