What is Zelle?
As of 2023, Zelle is a prominent digital payment network in the United States that allows individuals to send and receive money directly from one bank account to another in mere minutes. Developed as a collaboration among several major U.S. banks, Zelle aims to offer a quick, secure, and easy method to transfer funds, primarily for personal transactions.
Unlike some other payment platforms, Zelle doesn’t require a separate app or account setup if your bank is already a participating member. Users can typically access Zelle through their existing bank’s mobile app or website. If your bank isn’t a Zelle partner, there’s a standalone Zelle app that can be used instead.
While it’s lauded for its speed and convenience, users should ensure they have the correct recipient details before sending money, as transactions are usually instant and can’t be undone. Always double-check for accuracy to prevent mistaken transfers.
After clearXchange was sold, there needed to be a new name for the company. The new name was Zelle and all clearXchange users were told that they needed to start using this new mobile app. Zelle is now owned by Early Warning Services, which is itself owned by several of the largest banking institutions in the United States.
The CEO (Chief Executive Officer) of Early Warning Services (and therefore the CEO of Zelle) is Albert Ko, who has only been in the role for the last 2 years. Zelle itself does not directly generate any revenue. This will be discussed in a later section as well as how Zelle can generate revenue indirectly. Zelle has its corporate headquarters based out of Scottsdale, Arizona.
What is Chime?
As of 2023, Chime stands as a prominent neobank (online-only bank) in the United States. Founded with the mission to simplify banking experiences, Chime offers its members a no-fee checking account, a savings account, and a user-friendly mobile app to manage their finances. Unlike traditional banks with physical branches, Chime operates exclusively online, allowing it to cut down on overhead costs and often pass those savings onto customers in the form of fewer fees.
One notable feature of Chime is its early direct deposit, which can give users access to their paychecks up to two days in advance. Additionally, Chime has automatic savings tools, like rounding up transactions to the nearest dollar and depositing the difference into savings.
Over the years, Chime has grown in popularity due to its consumer-centric approach, offering services with minimal fees and transparent practices. However, as with all banking choices, potential users should review its features and terms to determine if it aligns with their financial needs and preferences.
Now that we have a good understanding of both companies, let’s look into how they work individually as well as how they work together.
Does Chime Work with Zelle?
Chime and Zelle operate independently and do not have direct integration. This means that, typically, Chime users cannot send or receive money using Zelle directly through the Chime app or website. Zelle is built into many traditional bank apps, offering instantaneous transfers between its member banks, while Chime’s foundation is as a neobank (online-only bank) with its own set of features.
However, Chime members wishing to utilize Zelle can still do so by linking their Chime bank account details (account number and routing number) to the standalone Zelle app. This way, they can receive money sent via Zelle. But it’s crucial to note that the speed of these transfers might not be instantaneous, as is the case with Zelle’s integrated bank partners.
For sending money directly from Chime, members usually resort to Chime’s in-app “Pay Friends” feature or other third-party money transfer apps. Always ensure to double-check any compatibility and service details before initiating transactions.
How to Set up Chime to Work with Zelle?
While Chime and Zelle are not directly integrated, Chime users can still receive funds via Zelle using a workaround. Here’s a step-by-step guide:
- Download the Zelle App: If you don’t have your bank’s mobile app that integrates with Zelle, download the standalone Zelle app from your device’s app store.
- Sign Up: Open the Zelle app and sign up using your email or phone number.
- Link Your Chime Account: When prompted to choose a bank, you might not find Chime listed. Instead, opt for the option that allows you to input your bank details manually. Enter your Chime account number and routing number.
- Verification: Zelle may deposit a small amount into your Chime account to confirm its authenticity. Check your Chime account for this deposit and verify the amount in the Zelle app.
- Ready to Receive: Once verified, you can now receive money through Zelle to your Chime account. Remember, while you can receive funds this way, sending money from Chime using Zelle might not be possible.
Always ensure transactions are accurate, and be aware that transfers might take longer than typical Zelle instant transfers.
What bank does Chime use for Zelle?
Zelle is renowned for offering instant transfers between its member banks. However, for non-integrated banks like Chime, the transfer speed might differ.
When someone sends money to a Chime user via Zelle, it’s not an instantaneous process as with member banks. Instead, these transactions usually follow the standard bank transfer timeline. Typically, funds may appear in the Chime account within 1 to 3 business days, but this can vary based on various factors.
It’s crucial for both senders and recipients to be aware of this delay. While Zelle prides itself on speed for its member banks, the same speed isn’t guaranteed for non-member institutions like Chime. Always ensure you have the correct recipient details and maintain open communication about transaction statuses to avoid misunderstandings.
For those looking for immediate person-to-person transfers within the Chime ecosystem, Chime’s “Pay Friends” feature offers an alternative for instant payments between Chime users.
How Fast is Zelle Payments Sent Using Chime?
Zelle remains popular for its near-instant transfers among its partnered banks. But when using Chime, a non-integrated bank, the experience is slightly different.
If someone uses Zelle to send money to a Chime account, the transaction doesn’t happen in real-time, unlike with Zelle’s primary bank partners. Instead, Chime users can expect a standard transfer speed, typically taking 1 to 3 business days for the funds to reflect in their account.
It’s essential to understand this delay when expecting or sending funds to a Chime account via Zelle. While Zelle is known for rapid transactions among its direct partners, that quickness doesn’t always translate to banks outside its network, like Chime.
For instant peer-to-peer transactions within Chime, users might prefer the “Pay Friends” feature, which provides immediate transfers between Chime accounts.
Related: How to use Spot Me on Chime
What fees to expect when using chime with Zelle?
One unique feature of Zelle is that it does not charge any fees to the individual to sell or receive money. Other peer-to-peer fund transfer services, such as Venmo or Cash App, will charge various fees surrounding instant withdrawal or sending money via a credit card. These fees can be upwards of 3% of the transfer and can therefore be a significant amount taken in fees if the transfer is a high amount.
On Zelle’s side, sending money using the standalone Zelle app is generally free for personal use. However, it’s crucial to always check with the sender’s bank, as some banks might charge fees for outgoing transfers or have restrictions on transaction amounts.
Here are some things to consider:
- Transfer Limits: While not a fee, both Zelle and Chime might have daily or monthly transfer limits. It’s essential to be aware of these to avoid transaction issues.
- Third-party Fees: While Chime and Zelle may not charge fees, there’s always the potential for third-party fees if using an intermediary bank or if involved in international transfers.
Always ensure to review the terms and conditions of both platforms before initiating any transactions to avoid unexpected charges. For the most accurate information, always refer directly to Chime’s and Zelle’s official communication or customer support.
Related: How does Chime compare to SoFi?
How does Zelle Make Money?
How does Zelle make money if they do not charge any fees? Well, the short answer is that it doesn’t generate revenue. Remember, Zelle was created by large financial institutions to be a money saver. Zelle was created to facilitate money transfers between customers who did not bank with the same company. So, since these companies still own Zelle, they do not need it to be a revenue generator.
Zelle can still indirectly provide an income stream in two ways for the banks that own it. First, it can act as a marketing arm of the banks that own it. For example, Zelle can provide add-on services such as mortgages, credit cards, auto loans, student loans, or insurance. With consumers already using Zelle, it makes a lot of sense for Zelle to in a way advertise these products that are offered through their bank. This is a great way to generate revenue for the bank as well as solve a need for the consumer.
The next way that Zelle can indirectly generate revenue is through business-to-consumer transactions. If a consumer were to buy a product or service from a business, the business must pay a small fee (typically 1%) to the card company. The card company then shares a portion of this fee with the issuing bank. Again, the consumer will not see any fee come their way.
Chime has a business model that is like one part of Zelle’s business model. Since Chime is not technically a bank, it does not have a traditional banking model. Banks make money by taking in deposits and lending out the money in the form of mortgages, auto loans, student loans, etc.
Banks charge a higher interest rate to their debtholders than they give to the depositors. Banks can then take the spread and that becomes their income. Any money not lent out can earn interest through safe investments (investments that have low risk and low returns). Additionally, banks can make a little bit of money through fee income. But this is not the business model for Chime.
Like Zelle, Chime makes money by taking a fraction of the fee that card companies charge businesses when a Chime account holder makes a purchase. Chime also does not charge fees to its customers. Even if someone overdrafts, Chime will not charge a fee (something very few banks will do). Chime will just stop the card from being able to be used if the negative balance reaches $100.
Related: How to Close a Chime Account
How to Send Money from Zelle to Chime
Sending money from Zelle to a Chime account in 2023 is straightforward, though it’s essential to note that the process might not be instantaneous. Here’s a step-by-step guide:
- Zelle App Setup: If the sender hasn’t already, they should download and set up the standalone Zelle app or use their bank’s app if it’s integrated with Zelle.
- Recipient’s Email or Phone: Ensure the Chime user provides the email address or phone number linked to their Zelle profile.
- Enter Details: In the Zelle app, select ‘Send Money’ and input the Chime user’s email or phone number.
- Specify Amount: Enter the desired amount to be transferred.
- Confirm and Send: Review the details for accuracy, then confirm and send the money.
- Chime User’s Action: Chime account holders should have their account linked to the standalone Zelle app. If they haven’t done this, they’ll receive a notification prompting them to set it up to claim the money.
Remember, while Zelle typically offers instant transfers between its member banks, transferring to Chime can take 1 to 3 business days. Always communicate with the recipient to ensure they receive the funds.
What’s the Weekly Transfer Limit for Between Chime and Zelle
The weekly transfer limit is $500 if the transfer is being done from Zelle to a non-participating Zelle bank. And since Chime is not directly available with Zelle, this is the weekly limit that can be transferred. However, the weekly limit is much greater if the bank is a Zelle participating bank. Bank of America’s limit is $3,500. Wells Fargo, Citibank, and TD Bank have it set at $2,500.
Chase is set to $2,000. USAA and PNC have their weekly limit at $1,000. If a transfer needs to be greater than $500, it may make more sense to use an alternative bank to have the transfer done in only one transaction. Chime has both a daily and monthly transfer limit to make transfers from an external account. The daily transfer limit is $10,000, while the monthly transfer limit is $25,000.
Troubleshooting Chime and Zelle Setup
The easiest way to troubleshoot issues between Chime and Zelle is to either contact their customer service directly or search their websites to look through frequently asked questions.
Chime has a help page that you can go to search for your issue.
The link can be found here: Help (chime.com). Additionally, Chime has a FAQ page that anyone can search through. This page can be found here: Frequently Asked Questions | How to Get Started with Chime Banking. Or you can directly contact their Customer Support by either emailing them at email@example.com or by calling them at 1-844-244-6363.
Zelle also has a FAQ page that their customers can search for any issue that they are having. The page can be found at the link here:
Support – Top Questions | Zelle (zellepay.com). The way to leave Zelle a written message is to navigate to this link (Contact Zelle Consumer Support | Zelle (zellepay.com)) and select the Other tab. Fill in your name, email address, telephone phone number, and message. Zelle will respond to your problem within 2 business days. If you prefer to contact Zelle by phone, their phone number is 1-844-428-8542.
Related: Does Chime Work with Cash App