Cash Payment Apps

Peer-to-peer (P2P) cash payment apps let people send and receive money electronically. People are increasingly using these apps because they’re fast, convenient, and easy to set up and use. You can pay someone for what you owe, and request and receive money. Pay your portion for the Airbnb you’re splitting with family, send your roommate half the rent or reimburse a friend for the money you borrowed. Any time you need to transfer funds to others, payment apps are the way to go.

Never use a P2P service for business purposes or for a money transfer with someone that you don't personally know. If you choose to use your cash payment app for a business-related transfer, the P2P service will likely offer no fraud protection or assistance in reclaiming lost funds. P2P services were created to be a means of transferring funds from friend to friend and most services clearly state in their policies that their platforms should not be used in business transactions. It's best to only use P2P payment services/your cash payment app among friends, family, and people you know and trust.

Cash payment apps provide streamlined electronic transactions between people. Link your checking account, debit or credit card, to the app. You may also be able to use funds from the balance on the app. Next, you’ll search for the recipient by phone number, email address, username or even Facebook (if you choose to sync to that social platform). From there, simply hand over the funds! Here’s how to get a cash app — like with any other app setup, search and download the app, sign up for an account and follow the prompts, including any steps for verification and passwords to increase security.

Cash Payment apps like PayPal, Venmo, and Zelle® have different ways of keeping your information secure like encrypting your financial information and using other security measures to protect your funds. However, these measures may not always be foolproof. Many P2P systems have been targeted by hackers and scammers so, it is always wise to use these apps to pay only people that you know and trust, like your roommate, best friend, or babysitter. It's not recommended that you use these apps to pay people you don't know, like a stranger selling goods on an online marketplace.

You can help to protect yourself from P2P scams by taking the following steps:

• Use two-factor identification and a PIN before completing a transaction.
• Set up alerts so you will be notified about every transaction.
• Double or Triple-check your recipient's information before you send a payment. A misspelled email address or wrong number could send your money to the wrong person.

We also recommend that you familiarize yourself with the security and best-practices of your cash app of choice.

• PayPal Security
• Venmo Security
• Zelle® Security

Most cash payment apps will allow you to make a payment from a linked financial account or directly into the P2P account at no cost. However, several providers will take 2-3% of any payment made with a debit or credit card. Also, if you want the funds transferred to your account immediately, you'll usually have to pay a flat fee or small percentage.

It usually takes one to three business days for the actual money to clear. If you really need the transfer to clear your account immediately, most P2P providers allow you to pay a small fee to make it happen.

Unfortunately, if you've been scammed or have had another issue with a P2P payment, there is not much to be done. Most services will offer their assistance to law enforcement agencies and notify users if they've been scammed, but that's usually the extent of their fraud protection.

Lots of users mistakenly think fraud protection will apply for transactions tied to their Visa® card or that their financial institution is responsible if a P2P payment goes astray. While your financial institution never wants to see you lose money for a simple mistake or because you've been victimized by a scam, there is not much they can do about it after the fact. For this very reason, we strongly advocate practicing caution when transferring money online or with your cash payment app.