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How to send, receive money using Zelle

This payment service’s simplicity may make it vulnerable to fraud. Here's what you need to know


Zelle is a convenient peer-to-peer payment app supported by many different banking institutions. While this payment system is fairly easy to use there are a few mishaps that you need to avoid.

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Launched in June 2017, Zelle is a peer-to-peer payment (P2P) system used by many different banks. This P2P system is very easy to use, but its simplicity can also make it more vulnerable to fraud.

If you already use Zelle or are considering using it, here’s what you need to know.

What is Zelle?

Zelle is a P2P payment system that lets you send or receive money from one person’s bank account to another individual’s bank account. In the past, both parties had to be enrolled in Zelle to use it, but now only one party needs to sign up for Zelle. The sender and recipient don’t have to use the same bank for a Zelle transfer to work.

If your bank offers Zelle – more than 1,000 financial institutions are currently part of its network – you can activate it through your bank’s app. You just enroll in Zelle and link it to a bank account or debit card. If your bank doesn’t offer Zelle, you have the option of downloading the stand-alone Zelle app, which is available for iPhone and Android devices, and linking it to a debit card.

How Zelle works

Using Zelle is pretty straightforward – it works much like other P2P systems, such as Venmo or PayPal. To send money or a request for money (a bill), you need the email address or phone number your recipient uses to identify their own Zelle account.

It’s important to remember that Zelle is for paying or receiving payment from other individuals – you can’t use it to shop online or in brick-and-mortar stores. That said, some small businesses can use Zelle to pay contractors or to receive money from customers; service providers can use it as a business tool.

Zelle payments can be instantaneous, which is why it’s so important to verify all the information and double-check the amount before you send money (we’ll explain why this matters shortly).

When it comes to how much money you can send and receive through Zelle, your bank will be the one to set any limits. Individual banks set daily, weekly and monthly limits. You can’t sign up for the service with a credit card; instead, you must link up a bank account or debit card to your account.

How much does Zelle cost?

If you access Zelle through a bank, that institution sets any fees that apply to using this payment system. However, it’s free to enroll and to send and receive funds through Zelle. Where you can run into fees is if your bank charges them.

It’s free to send and receive requests through the vast majority of banks, but you should confirm with your bank what potential fees you might run into before you start using Zelle.

If you use the stand-alone app, you won’t be charged any fees for opening an account or for sending or receiving money.

Why you need to be cautious

You may be wondering what happens if you accidentally send the wrong amount or send it to the wrong person. “Today, the payment is irrevocable,” says early warning services payment products director Chris Ackroyd. “Once that payment’s gone, you can’t get it back.”

As is the case with many P2P payment systems, there’s no guaranteed way to retrieve money once you’ve sent it. While you do have some legal protections, it’s not easy to get your money back if you send it to the wrong person.

If a payment “goes to the wrong person, you have federal rights,” says Lauren Saunders, associate director for the National Consumer Law Center. The same applies if you send to the wrong person or the wrong amount, she adds. “That is an error that is covered, and [the laws] do apply.”

Christina Tetreault, staff attorney with Consumers Union, agrees. “Is it clearly covered by the law? Yes,” she explains. However, providers aren’t always complying. “We’ve seen that people complain about sending money to the wrong person, and there doesn’t seem to be a reliable way to get that money back,” Tetreault adds. “We think service providers should be helping consumers get that money back.”

Consumer advocates would also like to see additional layers or prompts to help consumers catch misdirected payments before they’re sent, Tertreault says. In addition, some banks include steps in their send/request processes for users to validate that they’re sending money to the correct recipient.

If you send money to the wrong person, Zelle advises canceling the payment, but this will only work if the recipient isn’t yet enrolled with Zelle. If the recipient already signed up for Zelle, the payment can’t be canceled after sending because it goes directly to their bank account.

How to protect yourself when using Zelle

To help avoid mishaps, a good rule of thumb is to verify that a recipient’s phone number or email address isn’t just theirs, but is also the same one they use on their Zelle account. Since Zelle identifies users by phone numbers or email addresses, these forms of contact info act as unique identifiers. For further confirmation, Ackroyd recommends sending a small amount – 50 cents or $1 – first to make sure that the right person is receiving it.

When it comes to fraud, your rights are a bit more clear. The Electronic Funds Transfer Act governs Zelle transactions. If your bank account is hacked or someone you’ve never authorized uses Zelle to take money from your account, your bank should reimburse you as long as you report the loss promptly.

Depending on the bank, however, you could be out the money for up to 10 days while the bank investigates and if the bank decides you authorized the payment, your loss could be permanent. Also, the law doesn’t necessarily protect you if your purchase is defective, a scam or not what was promised.

When it comes to sending payments to people you don’t know, Zelle doesn’t recommend doing this, stating on its FAQ page, “Zelle is a great way to send money to friends, family or others you trust such as your personal trainer, babysitter, or a neighbor. If you don’t know the person, or aren’t sure you will get what you paid for (for example, items bought from an online bidding or sales site), we recommend you do not use Zelle for these types of transactions, which are potentially high risk.”

At the end of the day, you should use Zelle only if you already received the goods or services, and only with people you know and trust. You should never give anyone else access to your Zelle account.

Bottom line

If you use it properly, Zelle can be a handy financial tool to have in your back pocket. The key to using Zelle successfully is to make sure both parties are providing the correct account information and are taking the necessary steps to ensure the sender is transferring money to the right recipient.

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The editorial content on this page is based solely on the objective assessment of our writers and is not driven by advertising dollars. It has not been provided or commissioned by the credit card issuers. However, we may receive compensation when you click on links to products from our partners.

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