To settle debts between friends, money is on the way out. Americans’ use of paper money for person-to-person payments fell below 50% for the first time in 2021, according to the Federal Reserve Bank of San Francisco. On the other hand, the use of online services for person-to-person payments has almost doubled compared to 2020.
While online payment services make it easier to send people money with just a few taps on your phone, consumers need to consider the fees and security risks, as well as how quickly they need to transfer funds. Most services will take 1-3 days to process transfers, while offering faster processing for an additional fee.
Read on to find the most popular apps you can use in the US to pay for goods and services, request contactless payment, and send money to friends and family. To find out more, check out the look how and discover the .
If you have an iPhone, you can send and receive money directly through the Messages app with Apple Cash. You can use an Apple Cash credit card or debit card to fund a payment.
To initiate a transaction, open the Messages app and select or create a new contact. Tap the Apple Pay icon at the bottom of the screen, choose an amount, and tap request or send. Apple says it takes one to three days for transactions to be processed. Apple Cash is free unless you choose Instant Transfer, which guarantees processing in less than 30 minutes, but comes with a 1.5% transaction fee.
Read our Apple Cash explainer.
Once you sign up for Cash App, you are assigned a $Cashtag – your screen name. You can identify contacts using their email address or phone number.
Once you’ve added a bank account or credit card, you can send, request, and receive money through the app. As long as you fund and receive payments through your bank account, there are no fees or foreign transaction fees. But there are fees – 3% of the transaction amount – if you pay with a credit card.
Cash App typically takes between one and three days to transfer funds. There is an option to access your money instantly, but you are charged an additional 1.5% (with a 25 cent minimum).
Learn more about the Block’s Cash app.
Google Pay replaced Google Wallet and Android Pay in 2018. You can use it to pay for goods and services as well as send and receive money.
While Apple Pay is exclusive to iPhone users, anyone with a Gmail account can use Google Pay. You can access it directly through the Google Pay app or point your browser to pay.google.com. Transferring to a debit card typically takes 24 hours, while transfers to a linked bank account can take up to five days. There are no transaction fees to use Google Pay.
How to set up Google Pay on your Android phone.
One of the first digital payment platforms, PayPal is free to use as long as it’s connected to a bank account (or you have a PayPal Cash bank account). If you initiate a transaction using a credit card, a 2.9% fee applies, plus $0.30 per transaction. Standard transfers can take one to three days to appear in your account. Instant transfers appear immediately but are charged a 1% transaction fee.
Learn more about PayPal.
Owned by PayPal, Venmo is the third most popular financial app on the App Store. Once you download it, you can send or request money to or from anyone else in the United States with a Venmo account. It’s free as long as payment comes from a bank account, debit card, or prepaid debit card. For credit card funded payments, Venmo charges a 3% transaction fee.
Transfers to a bank account usually take between one and three days to clear. There is an option for instant transfer, which is processed in 30 minutes or less. These are charged an additional transaction fee of 1.5% (minimum $0.25, maximum $15).
Owned by a collective of seven US financial institutions – Bank of America, Capital One, Chase, PNC, Truist, US Bank and Wells Fargo – Zelle lets you transfer funds directly between bank accounts. There is no app to download or account to set up. Simply enter the email address or phone number of the person you want to pay, and presto: the transaction is instant, and all your contact details and bank details remain private.
You can download the Zelle app or use it on your bank’s website, if it’s one of over 1,300 institutions that support it. (Not all banks and credit unions participate, but most do.) Although Zelle does not charge you to send or receive money, some banks may apply fees to transactions made using the technology.
Due to its instantaneous nature and inability to reverse transactions, Zelle is under fire not doing enough to protect consumers against fraud. Indeed, a variety of increasingly common Zelle scams plagued users across the country in 2022.
Learn more about Zell.
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