Banks Unveil a New Way to Transfer Money

Need to send money to a friend or a local handyman? Right now, you'd probably write a personal check. But the three largest U.S. banks are rolling out a system that they say lets you transfer money quickly and safely using just the recipient's cellphone number or email address.

See also: Older Americans are among the few who still write checks.

The system, called clearXchange, was unveiled in May by Bank of America, JPMorgan Chase and Wells Fargo, which call it a more convenient alternative to third-party money transfer services such as PayPal and Xoom.

Users will access clearXchange through their bank's remote banking application, and transactions will be protected by the strong security precautions that these applications typically employ.

For now, only Arizona residents who are customers of Bank of America or Wells Fargo can send money using clearXchange, and only those banks' customers can receive funds. But the banks expect eventually to offer the service to their customers nationwide, says Gabe Boehmer, a spokesman for Wells Fargo in Portland, Ore.

ClearXchange expects other major banks to join the system as well, Boehmer says.

The system is free to bank customers using it during the present trial phase. Boehmer says no decision has been made about pricing after clearXchange becomes available nationwide. But he said it might remain a free service, similar to online bill paying, for customers who use it for personal banking and not as part of a business operation.

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