Independent Banker - April 2022 - 69

A community bank-fueled
payments rail
A secure, open-loop, cost-saving, customer-accessible, multiplatform P2P payments network
might sound too good to be true, but community bank consortium Alloy Labs Alliance hopes
to achieve just that with the CHUCK payment rail. By Katie Kuehner-Hebert
different kind of peer-topeer
payment service is now
available, " built by community banks
for community banks. "
A
In December, members of Alloy
Labs Alliance-a consortium of
community banks that includes
several ICBA members-launched
CHUCK, an open network for instant
person-to-person (P2P), businessto-business
(B2B) and consumer-tobusiness
(C2B) payments that allows
recipients to choose the payment
rail where they want the money
deposited. For example, a customer
of a participating bank can send a
payment using the bank's application
on their computer or mobile phone
and can route the money to either
their checking account or to another
payment rail like Venmo.
" We don't need a new version of
Zelle, " says Jason Henrichs, CEO
of Alloy Labs Alliance in Saint Paul,
Minn. " We need to think of payments
holistically and create a payments
hub that enables community banks
to also participate in the digital
payments revolution. "
The CHUCK network, which is
available to all U.S.-based banks,
fintechs and more, sits on top of a
payments rail operated by Payrailz, a
digital payments company based in
Glastonbury, Conn.
Julieann Thurlow, CEO of
$730 million-asset Reading
Cooperative Bank in Reading, Mass.,
was instrumental in leading the
effort to create the open network in
collaboration with the consortium's
other institutions.
" For a community bank to be
innovative means you need to
make big bets with your depositors'
capital-and that's something we take
very seriously, " Thurlow says. " By
working with other banks, we can
share the costs, which allows us to
take bigger bets on innovation than
each of us could do on our own. "
The whole package
Name:
Alloy Labs Alliance's
CHUCK network
Launched:
2021
By participating in the CHUCK
network, community banks can offer
a much more secure P2P service
than some other rails by requiring
multifactor authentication and other
controls, Thurlow says. Moreover,
payments are withdrawn from
the user's FDIC-insured checking
account and are protected by multiple
layers of security, which prevents
fraudster access.
" For the bank, participating in
this network also enables all of our
" The beauty
is that this
network has
been created
by community
banks for
community
banks. "
-JULIEANN THURLOW,
READING COOPERATIVE BANK
customers' information to be under
one roof, rather than being spread
around the payment ecosystem, "
Thurlow says. " It also helps us better
control that data for the customer
as well. "
Thurlow encourages other
ICBA member banks to consider
participating in CHUCK. " The beauty
is that this network has been created
by community banks for community
banks, which means we've also
intentionally kept the costs down, "
she says.
American State Bank in Sioux
Center, Iowa, is another CHUCK
network participant.
" As a bank, we are always
evaluating new products or services
to meet or exceed our customers'
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Independent Banker - April 2022

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