According to Reuters, nearly 250m transactions valued at $75bn were transferred through Zelle in 2017. The app launched in the middle of the year.

PayPal, which owns Venmo, says that Venmo, which is especially popular with millennials, saw $30bn in transfers in the 12 months through September. That means Zelle is already bigger than Venmo in terms of the dollar value of transactions it’s processing.

Big caveats

Of course, it must be noted that Zelle was technically already larger than Venmo on the day it launched. That’s because Zelle is essentially the front-end interface for the clearXchange Network, a digital payments network that now has over 60 members, including large banks like Wells Fargo, Bank of America and JPMorgan Chase.

While some 95m consumers have access to Zelle through their banks and Early Warning Services, the company that operates Zelle, says that more than 100,000 people are logging into Zelle daily, when it comes to how many consumers actually know about Zelle, Venmo’s position in the market looks far more competitive. According to Reuters, whereas the word Venmo is now a verb among many younger consumers, Zelle’s brand recognition is still very limited.

Interestingly, and perhaps tellingly, Early Warning Services also wouldn’t reveal how many people regularly use Zelle.

Key takeaways and questions

But how much does brand recognition and direct usage really matter for Zelle? On one hand, thanks to its wealthy banking backers, Zelle has been spending big to promote itself to consumers. Reuters says that ad spots Zelle is buying “can cost from $500,000 to well over $1 million” and banks that are part of Zelle’s network are also buying their own ads. Zelle’s campaigns star rapper and Broadway actor Daveed Diggs.

But even as it spends big to promote itself to the masses, Zelle clearly doesn’t intend to compete head-on with Venmo, which for its part insists that it has no intentions of advertising beyond its core base of younger consumers. As Lou Anne Alexander, the group president for payments at Early Warning Services, explained to Reuters, the goal of Zelle’s ad campaigns is “to make consumers aware that the majority of them already have access to Zelle in their banking app.”

Put another way, because of the way Zelle is structured, and the fact that members of the Zelle consortium have integrated Zelle into their own banking apps, Zelle in many cases doesn’t even need to convince consumers to download an app and use it. It simply needs to drive awareness of functionality that a large number of consumers already have through their financial institutions’ banking apps.

The big question here is whether ubiquity will beat out brand. Or is it possible that Zelle and Venmo’s strategies can both be successful, albeit in different ways? In other words, is the market that both Zelle and Venmo serve big enough for multiple players with distinct strategies and userbases?

Time will tell. In the meantime, it would appear that established financial institutions can make inroads into a market dominated by a fintech upstart when they target use cases that have already been validated, band together and flex their marketing muscle. That alone is a valuable lesson.