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Even under lockdown, there are a lot of reasons you might need to split up a bill or send someone some money. But picking one can be a bit of a chore, and signing up for all of them even more so. Still, these services are far more convenient than using clumsy bank ACH transfer tools or, as is hardly thinkable right now, cold, hard cash. And if you're still splitting the bill with cash, frankly, you're doing it wrong — to get the most from your money in the digital age, you should be using a peer-to-peer (P2P) payment app. What are your options out there and what do they each offer? Let's take a look.
Why you should use a P2P payment app
There are many reasons to use a P2P money app instead of cash, cards, or checks. For starters, being able to send money from your phone is the ultimate convenience — all it takes is a few taps to complete a transaction. You also don't have to worry about lugging around dollar bills in your pocket or purse where they could get lost or even stolen — you can do everything right from your smartphone, which is likely always tethered to your hand as it is. Finally, electronic money transfers are safe, secure, and reliable.
The most difficult part about using a P2P payment is knowing which one to choose.
The best P2P payment apps available on Android
Unlike cash that's universal among your friends and family, you can't just text money to someone and hope they receive it. Both participants have to be using the same money app or service (in most cases). Even more daunting is that there are quite a few options on the market for you and your loved ones to choose from. Here are the top 5 best P2P payment solutions and why they deserve to grace your app drawer:
PayPal Mobile Cash
When it comes to electronic money transfers, PayPal is the OG of the bunch. It launched in 1998 under the name Confinity, long before smartphones or high speed data were a thing. After being acquired by eBay in 2002, PayPal became the preferred way to bid on eBay products. Now as its own publicly traded company, PayPal has evolved to meet modern P2P needs.
The PayPal Mobile Cash app allows users to send or request money from other users within the PayPal network. Once received, funds can be transferred to a primary bank account almost immediately (with a 1% fee per transfer, up to $10) or in 1-3 business days (with no fees).
Alternatively, funds can also be used to make online purchase wherever PayPal is accepted. Users can also create a smart pool with a group of friends, send funds abroad, donate to their favorite charity, or even start investing with Acorns.
When PayPal's mobile payment subsidiary, Venmo, dropped onto the scene, it offered a communal aspect unlike anything seen in a mobile wallet app. Equipped with a social media feed akin to something found on Facebook or Twitter, Venmo displays a list of friends' transactions complete with any messages or emoji they leave for each other. Depending on how private of a person you are, this may or may not be something you want your friends to see; luckily, this can be adjusted in the app's settings.
In terms of transferring money, Venmo users can request or receive payments from friends, just as you'd expect. Similar to PayPal, funds can be transferred to a connected bank account instantly (with a 1% fee per transfer up to $10) or in 1-3 business days (with no fees); however, funds cannot be used for investing or donating to charities.
Square Cash App
Just like PayPal, Square got its start as a company outside the P2P realm. Founded in 2009 by Twitter CEO Jack Dorsey, Square was a merchant services aggregation company that allowed small business owners to receive credit card payments from patrons by connecting a mobile credit card reader to a mobile device via the 3.5mm headphone jack. Today, Square has a number of financial-based ventures, including a P2P solution called the Square Cash App.
First and foremost, the Square Cash App allows users to send or receive money from their friends and family. These funds can then be transferred to a bank account instantly (plus a 1% fee) or in 1-3 business days (for free). The Square Cash App also recently added the ability for users to invest their funds in the stock market and Bitcoin, giving them the power to diversify their digital dollars.
Zelle is the product of a union between major banks, including Bank of America, Wells Fargo, Chase, and many more. As long as you have a registered Zelle profile, you can easily send or receive funds directly from your bank account, no extra steps required. Transactions are usually completed within minutes and without that pesky 1% fee that other services charge.
If your bank or credit union is on the partners list, you should be able to transfer funds directly from within your banking app. If your financial institution isn't on the list, you can still use Zelle's P2P capabilities, but only through the Zelle app.
Google's been in the mobile wallet game for a while now, starting with NFC payments through the Google Wallet app, which later evolved into the Google Pay app.
In 2018, Google launched its own P2P solution for both Android and iOS users. The great thing about Google Pay P2P is that it can transfer money straight to a recipient's bank account, even if they don't have the Google Pay app.
When using a debit card, Google Pay can send or receive money "quickly" and usually in less than 24 hours. When using a bank account, funds can take up to 5 days to reach their destination. There are no fees for sending or receiving funds via Google Pay.
Which P2P payment app should you choose?
Generally speaking, all of these apps function in similar ways. They can all send and receive payments, and unless you're willing to pay a small percentage fee, most of them generally take 1-3 business days for those funds to hit your account.
Deciding on the best P2P payment app for you ultimately comes down to what your family and friends are using. Whichever app is most ubiquitous among your group is the one you should choose. And once all of you are set up in the same mobile payment ecosystem, sending and receiving money with your Android phone will start to seem as easy as sending an email.