Two months ago, U.S. Bank and Bank of America were at odds over what to charge customers for instant, person-to-person payments on a fast-growing bank-owned network called clearXchange.

Bank of America offered the service for free, and U.S. Bank charged $6.95 per transaction. The Minneapolis-based U.S. Bank’s CEO, Richard Davis, argued that it was important for banks to charge for such services as a matter of precedent, so consumers wouldn’t “expect everything to come without a value price to it.”

U.S. Bank shifted its position Wednesday, announcing that because of the quick expansion of the network, the bank will offer instant person-to-person payments for free.

“Customers’ demand for real-time, person-to-person payments is growing and the network is expanding — it’s a perfect demonstration of how the banking industry is working together to deliver safe and easy solutions for customers’ evolving financial preferences,” said Gareth Gaston, the bank’s executive vice president for Omnichannel Banking, in a statement.

The news highlights the fast-moving landscape of smartphone payments, where upstarts like PayPal, Venmo and Square are peeling off peer-to-peer business from traditional banks.

Firms that become dominant in payments will help shape the future of transactions with merchants, who long have yearned to escape the control of card networks like Visa and MasterCard. Meanwhile, services like ApplePay are already becoming important intermediaries at the cash register.

At the moment, PayPal has 179 million users worldwide, and its mobile subsidiary, Venmo, reported $3.2 billion in transactions in the first quarter, more than double the volume a year ago. Snapchat, Facebook and Square all let people send cash to their friends quickly.

The nation’s largest banks, which jointly own clearXchange, still have major advantages.

They control most customers’ cash accounts. They alone can offer true real-time service. And they believe they have the potential clout with clearXchange and its 28 million registered users to attract customers from many more financial institutions and develop the critical mass to muscle out the competition.

But they have lost ground, particularly among young people, to slick apps that allow customers to move money — not instantly but quickly enough.

And this September, payments through apps not controlled by banks will be able to get faster, when the Automated Clearing House adds two new windows for payments to clear during the day.