Mobile peer-to-peer payment apps: how to transfer money to your friends using a smartphone

13 December 2016

Smartphones have evolved to be more than just portable devices with calling and texting capabilities, nowadays they are actively used as personal digital assistants keeping their users informed, productive, organized, entertained, and socially connected. However, the technical revolution doesn’t stop here: each year brings new mobile innovations that shake the market and favor the appearance of innovative apps meeting the emerging needs. The latest industry trend is mobile P2P payment services allowing users to send money to each other, split restaurant checks or utility bills, send a birthday gift and share the costs of social events.

Mobile person-to-person (P2P) money transfers is a way to redirect funds from your plastic card or bank account to another individual’s account via a mobile application, without visiting ATMs to get cash or brick and mortar banks to cash checks. Sending money electronically helps users reduce transaction costs and at the same time make payments more quickly and easily. Here is a list of the most popular mobile P2P payment apps designed to transfer funds to your friends or family members with just a few clicks or taps of a phone screen. Don’t feel embarrassed if you don’t have enough cash to pay your share – use your smartphone to transfer money!


Founded in 2009, Venmo is a US-based financial services provider making money transfers between individuals simpler and more convenient. Using their mobile app which can be downloaded from the Google Play Store and the Apple iPhone App Store, you can charge your friends or vice versa, receive payments from your friends. The money can be stored on your account balance or cashed out immediately to a bank account. There are two ways to send money using Venmo: you can either transfer money directly from your Venmo balance, or link your bank account or debit card and then transfer money from it.


Besides being the payment and request system, Venmo also acts as a small social network built around transactions – you can find and add friends automatically by syncing your Venmo account with Facebook or phone contacts. As for processing fees, the service is free when you send funds from your account balance or via your bank account or debit card. However, if you fund the transaction using a credit card, then Venmo charges 3%. Receiving money is also free.

Square Cash

Available for US citizens, Square Cash works similar to Venmo: you can use their simple mobile app to open an account, link your debit card and then make payments to your friends – or to strangers. The difference is that this service provider redirects funds in and out of users’ debit card accounts directly, without keeping money on the balance. Plus, you can also take advance of the “$cashtag” feature: if you don’t want to disclose your identity, you can choose a nickname to request payments like “$Ann_pay_2_me”.

Square Cash supports payments to businesses and individuals – you can send money to your friends or other people using your personal account or accept payments for goods and services using your business account. In the first case, all debit card transactions are free (you can send up to $2,500 per week). If you want to pay via a credit card, the commission is 3%. As for business money transfers, the fee is 2.75% (paid by recipient).


One of the oldest and most famous financial services providers in the world, PayPal is expanding their reach into new areas of the growing digital banking market by launching their own P2P payment service called PayPal.Me. If you want to ask somebody to fund your PayPal account, you just need to generate a special link and then send it to the necessary people. They can click the link and enter the amount they want to send you.

One of the most obvious benefits of the service in comparison with its competitors is its international reach: you can make P2P payments across borders, sending money in 25 currencies. However, the fees are quite high: while PayPal transactions made directly to/from your PayPal balance or bank account linked to it are free, you’ll have to pay 2.9% + a fixed fee depending on the transaction currency for payments sent via a debit/credit card or PayPal Credit.

Google Wallet

Available to any person having a Gmail account and living in the United States, the Google Wallet app allows users to transfer money to their friends or businesses from their linked debit card, bank account, or app account balance. To send money, you need to enter the recipient’s email address or mobile phone number. When you receive money sent through the service, you can withdraw it to your bank account or debit card.

Google Wallet

One of the biggest advantages of Google Wallet is their high transaction limits – you can send up to $9,999 per single transaction or up to $50,000 per five-day period. Take into consideration that there are also no fees for passing money back and forth – the transactions are free for both senders or receivers. Plus, all app transactions are covered by Google Wallet Fraud Protection, even if you are sending money to a non-Gmail address.

Facebook Messenger

Along with Google, another international Internet giant has also penetrated the mobile payments market – Facebook. Last year, the company integrated a new P2P payment service into Facebook Messenger, a popular standalone messaging app for smartphones and web browsers. Now users are able to send money to their friends and family through messaging. Facebook business model offers free sending and receiving of funds.

If you want to send money via Messenger, you need to click the “$” icon above the keyboard, specify the amount you want to transfer, and then enter your debit card data. To receive money, you need to open the conversation containing the money, then click Add Card and provide your debit card data. It is also possible to request money using the same dollar icon above the keyboard. In future, Facebook plans to turn Messenger into a fully-functional commerce platform allowing merchants’ chatbots to accept payments for goods and services.

Thanks to mobile banking innovations such as e-wallets and a wide range of financial apps, the smartphone is becoming the main digital banking channel, especially among the new generation of consumers who rely on their portable mobile devices to get through the day. The financial services sector is blooming and full of new ideas aimed to persuade people to ditch their physical cards and cash in favor of simple digital alternatives. It is expected that next year 30% of P2P volume will be paid via mobile phones, so it’s time to review all offers and choose the most suitable app!

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