Editor’s note: This is a transcript of the audio file.
Good news for people with no money and a rich uncle: Receiving money from a friend or relative is getting easier. And cash and checks aren’t required.
I’m Janet Stauble with the Bankrate.com Personal Finance Minute.
Bank of America, JPMorgan Chase and Wells Fargo customers will soon be able to transfer cash directly from a checking account to someone else. No routing or accounting numbers are necessary: All they’ll need is a recipient’s email address or phone number.
The three banks formed a joint venture to offer this person-to-person pay service through clearXchange.
Aside from its deal with the banks, clearXchange is going beyond banking. It can replace cash and checks in everyday situations, like splitting a restaurant bill or tipping a hairstylist. The service could rival PayPal’s person-to-person payments.
It’s still not clear if the big three banks will charge their own customers extra for the person-to-person pay. But the banks will have to pay clearXchange for using the service.
There are still unanswered questions about the service’s fraud protection and error correction.
Other banks and financial institutions may start rolling out the service, too.
Of course, some banks like ING Direct are already ahead of the curb. ING lets its customers bump payments to each other through iPhones.
To learn about the latest in banking, visit Bankrate.com. I’m Janet Stauble.