Zelle P2P payments increased 97 percent in the fourth quarter of 2018, Bank of America said Wednesday (Jan. 16), signaling the latest burst of growth for that payment method. During that quarter, consumers made 52 million payments worth $14 billion via Zelle.
In its Q4 2018 financial release, Bank of America also gave updates on its mobile and digital efforts. The financial institution said that 27 percent of all consumer transactions came through digital channels during that period, and that 49 percent of all digital transactions came via mobile. Those figures represent growth from the third quarter. During that period, according to the bank, digital transactions accounted for 23 percent of all consumer banking sales in the third quarter.
In all, Bank of America now has 36.3 million active digital banking users, along with 26.4 million active mobile banking users, up 9 percent. The earnings report also said that 4.8 million consumers have completed 23 million “interactions” with Erica since the late 2016 launch of the financial institution’s virtual assistant.
For the bank’s commercial, large corporate and business banking business, the number of digital channel users stands at about 485,000. “Digital Disbursements, the business-to-consumer payments solution that leverages the bank’s investment in Zelle, saw domestic volumes grow 66 percent in 2018,” the bank said in its earnings release.
That growth comes amid increasing focus on fast and digital disbursements. According to the recent PYMNTS Disbursements Tracker, “in recent years, a long list of companies — and even whole countries — have established faster payment systems and processes, enabling consumer disbursements for insurance payments, rebates or even freelance and gig work wage payments.” Within five years, in fact, the projected market value of instant and real-time payments will reach $25.9 billion.
Digital also played a role in consumer mortgage applications, with 19 percent of them coming in via online channels in Q4.
For its payment and debit card business, Bank of America said combined credit and debit card spending increased 6 percent year over year, to $151.9 billion. Average card outstanding balances stood at $95.8 billion in the fourth quarter of 2018, up about 2.5 percent year over year. The bank’s provision for credit losses increased $29 million to $915 million. Loans increased by 1.9 percent.
The bank said non-interest income in Q4 increased $777 million, or 12 percent, growth driven by higher interest rates and deposit and loan growth. Non-interest income included higher card income and service charges. The bank said the net charge-off ratio was 1.22 percent in Q4 compared to 1.21 percent. Net charge-offs increased due to credit card portfolio seasoning and loan growth.
Overall revenue, meanwhile, increased about 10 percent, to $9.9 billion, Bank of America said.