Your complete guide to smartphone money transfer apps
Apple, Google, Facebook, Square, PayPal and Venmo all want to help you pay
Apple, Google, Facebook, Square, PayPal and Venmo all want to help you pay
Have you used cash this year? At a time when we're going out less – and are more wary than ever of germs transferred on items like bank notes and coins – cash has taken a back seat, potentially forever. Paying with contactless credit or debit card has become the norm in many countries the world over, and paying via smartphone is a hot trend that shows no signs of decline.
Already the centers of our social lives, our smartphones can now replace the cards and coupons in our wallets and purses. They let us buy online, pay in-store, transfer money from one account to another, split bills and pay friends with a couple of taps. Startup banks like Monzo even want to replace established hughstreet banks with digital alternatives, and Apple wants in on the action with the Apple Card and Apple Pay.
The latest tech company with banking ambitions is Google, via its freshly revamped Google Pay app. Announced this week, the major update includes a way to pay friends and companies alike, store coupons and receipts, and in 2021 Google promises "a new kind of digital bank account".
It looks increasingly like cash's days are numbered, so here is a quick look at the most popular smartphone apps for quickly and easily transferring money between friends and family.
The PayPal app is free for iOS and AndroidPayPal
A player in the digital money transfer game since the 1990s, PayPal has a level of trust and brand recognition that few of its contemporary rivals can match.
PayPal offers protection when buying and selling to strangers, and has more relaxed transfer limits than some of the competition. This means any payment made for goods and services is protected and refunds will be issued if the goods are missing, defective or fraudulent. Even if a fraudulent seller won't play ball, or even ghosts you, PayPal can get you your money back.
A neat feature is how you can be paid by anyone — whether they have a PayPal account or not. Just share the address of your PayPal.me page and they can send the money across right away. While this works fine for individuals, there is no bill-splitting feature so paying for your share of last night's bar tab isn't as straightforward as it is with other apps. That said, your phone's calculator app is always just a couple of taps away.
PayPal lets you transfer more money than its rivals — up to $10,000 per transaction — and while withdrawals from your PayPal account to your bank are initially capped for new users, verifying your account by linking and confirming a bank account and debit or credit card unlocks this cap.
All this security and peace of mind comes at a cost. While money can be freely transferred to and from a bank account, so you can pay a friend back at no cost, paying with a debit or credit card will cost you every time. The fee for sending money to someone using either type of card is 2.9 percent plus 30 cents per transaction for US customers.
Sending money internationally to a PayPal account or a bank account incurs a five percent fee with a minimum fee of $0.99 and a maximum fee of $4.99, for US customers. There is no fee for receiving personal transactions when no currency conversion is involved.
Venmo is owned by PayPalVenmo
Bought by PayPal in 2013, Venmo is part-social network, part-money transfer app. During setup you are invited to add your Facebook friends and contacts, so they're loaded into the app and ready to receive your payment next time you owe them.
The social network side of Venmo lets you share news of your payments with other Venmo users around the world. Say you charged a friend for last night's pizza — this will, if you want, appear in the news feed of other Venmo users, minus the amount that was spent. However, the social aspect thankfully isn't a compulsory part of using Venmo.
Bills can be split with an integrated calculator, making it easy to work out how much you owe each other for dinner, or that amazing 2021 holiday you have promised yourselves all year.
For added flexibility, Venmo lets you add up to six debit and/or credit cards to the app, plus a bank account. Money accumulated in the Venmo app can be held there as credit, ready to be sent to someone else next time you owe them, or you can withdraw it straight to your bank account if you prefer to keep everything in one place.
Unlike some money transfer apps, Venmo works within iMessage on the iPhone. That way, you can quickly transfer money to one of your contacts by sending them an iMessage.
Transactions are initially limited to $299.99 per week, but verifying your identity increases this to $4,999.99. Confirming your identity is done by providing your ZIP code, date of birth and the last four digits of your Social Security Number.
Transfers from a debit card, bank account and Venmo balance are free, but sending money from a credit card will cost 3 percent per transaction. However, if you pay a Venmo-affiliated merchant this fee does not apply.
Square Cash app for iPhoneSquare Inc
Founded and headed by Twitter chief executive Jack Dorsey, Square began life as a company producing pocket-sized card readers for merchants to accept payments through iPhones. Now it also offers Square Cash, an iOS and Android app for sending money to friends and family without the need to swipe a card.
Simply called Cash App, the application is set up with your phone number or email address and needs a debit card to function. Credit cards can also be added, but fees apply (see below).
Money can be requested from anyone with the $Cashtag feature, where those who owe money but don't have a Square Cash account are directed to your $Cashtag page, where they can pay with their debit card. You can also share your Square details by having a friend scan a QR code displayed in your Square Cash app.
Bills can be split within the app and money can be requested from several people at once — when you ask for their share of the dinner you paid for, for example. However, bills can only be split evenly and cannot be edited.
Unlike some money transfer apps, Square's Cash App can be used for general banking, such as receiving your pay check, paying your tax returns, and managing direct debits, thanks to having a routing and account number. Square also offers the free Cash Card, which is a debit card to be used for paying online and in-store. This card has an incentive system called Boost, which offers instant discounts when used with certain retailers. Finally, the Cash App can be used to invest in stocks and convert US dollars into the bitcoin cryptocurrency.
Unverified users can send up to $250 per month through Square Cash, however this is increased to $2,500 once you verify yourself with your full name, date of birth and the last four digits of your Social Security number. There is no limit to how much money you can receive through the app, but verification is needed if you wish to receive over $1,000 within any 30-day period.
There are no fees for using a debit card, but credit cards are subject to a 3 percent fee on each transaction. regular cash transfers from the Square app to your bank account take two to three days. Instant transfers are
The new Google Pay app can be used to split bills with friendsGoogle
Google Pay is the result of the search giant consolidating its Android Pay and Google Wallet services into one app. Google Pay can be used just like Apple Pay (and Samsung Pay, for that matter) where edit and credit cards are loaded onto the app, ready tp make contactless payments with a tap of your NFC-enabled smartphone. The app also includes details on nearby offers from local stores and other retails, has a place to store loyalty cards, and can be used to pay for the use of some public transit system.
And as we mentioned at the top of this article, Google Pay was transformed in November 2020 to also include pee-to-peer payments, and much more besides. You can pay, see past transactions and find offers and store loyalty information, within the one app. Payment group chats can be set up for splitting bills with friends, and the Google Pay app will help you work out the math too. The app also lets you order food at over 100,000 restaurants, Google says, buy gas at over 30,000 stations, and pay for parking in over 400 cities across the US.
Coming in 2021, Google also says the app will be "a new way to bank," thanks to a new mobile-first banking system called Plex. This will give users a new bank account, including checking and savings accounts with no monthly fees, overdraft charges or minimum balance requirements. This will all be US-only at launch.
Up to $10,000 can be sent through Google Wallet in a single transaction or over any seven-day period.
There are no fees for using debit cards and bank accounts with Google Wallet, while there is a 2.9 percent fee added to credit card transactions.
With 1.3 billions active monthly users, chances are that whoever you need to pay — or request money from — is already a Facebook Messenger user. It's less likely that both parties will have added a debit card to their Facebook account, however, but doing so is simple and once you have you can exchange money in Messenger chats.
Just tap the blue '+' button next to the chat box, tap the green Payments icon, then enter the amount and tap 'Send' or 'Request.'
Bills can be split by starting a group chat with the friends you are splitting with, then enter how much each person owes and tap request. Unfortunately, you cannot split bills unevenly and Facebook won't do the maths for you, so this is only really useful if the friends each owe you the same amount and you've already worked that figure out in advance.
You do not need to be friends with someone on Facebook to send money or a cash request to them.
Once you have verified your identity, Facebook Messenger lets users make transfers of up to $9,999.
There are no fees for using a debit card with Facebook Messenger, as credit cards with their fraud protection services are not supported.
Finally, we have Apple Pay, which was previously called Apple Pay Cash. Residing in both the iMessage and Wallet apps of your iPhone, Apple Pay lets you pay contacts in a similar way to Facebook Messenger. Start an iMessage chat, tap the Apple Pay button, enter the amount, confirm via Touch ID or Face ID, then tap send. Requesting money works in the same way.
By default, money is taken from your Apple Cash balance. Otherwise, you can switch off Apple Cash and use the default debit card from the Apple Wallet app of your iPhone instead. You can also use a credit card, but this will incur the industry-standard 2.9 percent fee, so you're best using a debit card or your Apple Cash balance instead.
You can transfer up to $10,000 per transaction and up to $20,000 within a seven-day period from Apple Cash to your bank account. The maximum Apple Cash balance you can have, after verifying your identity, is $20,000. When sending money you can send/receive a minimum of $1 and a maximum of $10,000 per iMessage, or within a seven-day period.
There are no fees for transferring money from your bank account to Apple Pay, or vice versa. Credit card usage incurs a 2.9 percent fee, and instant transfers there is a one percent fee, with a minimum fee of $0.25 and a maximum of $10.
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