Peer-to-peer payment apps have changed the way we send and receive money. But the number of applications makes it difficult to determine the best option for your unique money needs.
In addition to sending money, some of these apps have grown into full-fledged financial services platforms, complete with banking, investing, and more.
In partnership with Cash App, let’s take a closer look at the various types of peer-to-peer payment options so you can determine which one is right for your situation. If you are curious about getting started with Cash App, you can open an account and try it >>
Cash App started as a platform that facilitates peer-to-peer payment options. Since its inception, it has evolved into a financial services application. Like the other apps on this list, you can send and receive cash using a bank account, debit card, or credit card.
Your Cash App Spend account comes with a Cash Card, which is a Visa debit card. The card can be used anywhere Visa is accepted. If you want your paychecks sent to you through the Cash App, you can receive direct deposits into this account.
Also, with Cash App, you can buy shares and Bitcoin through the platform. If you choose to invest in stocks, the fractional stock option gives you the ability to grow your portfolio at your own pace.
You can even prepare your taxes for free through the Cash App platform (with Cash App Taxes).
Learn more about Cash App in our full review.
Details of the transaction
Before verifying your identity, you can send and receive up to $1,000 within a 30-day period. After verifying your identity, you can send up to $2,500 per week.
When you send money via credit card, there is a 3% transaction fee. You can avoid paying this fee if:
- You send cash through a debit card
- Receive money through Cash App
When you make the withdrawal, you will have a free option that takes a few business days. If you need the funds instantly, there is an instant debit card deposit option. But it will also incur a fee from 0.5% to 1.75%.
advantages
- Standard bank withdrawals are free
- No commission for sending money with a debit card
- Possibility to buy shares and Bitcoin
- Banking services, complete with a Visa debit card
- free tax preparation
cons
- 3% commission for sending money with a credit card
- Instant withdrawal fee up to 1.75%
Get started with Cash App here >>
Venmo
Venmo, owned by PayPal, offers a social way to send peer-to-peer payments.
When you send money to someone, you have the option to add what it’s for and include emojis. The default mode on Venmo is to share your payments with your “friends” in the app. So they could see that you split the check for dinner. But you also have the option to keep this information private.
You have the option to have your paychecks sent directly to Venmo via direct deposit. If you are interested in buying cryptocurrency, you can start building a cryptocurrency portfolio for as little as $1. Venmo is probably the closest competitor to Cash App today.
Details of the transaction
Before verifying your identity, you can send up to $299.99 per week. After verifying your identity, you can send up to $60,000 per week on Venmo.
When sending money with a credit card, you will be charged a 3% fee. However, it’s free to send money to other people when you use your Venmo balance, debit card, or bank account balance.
When you receive money, you have the option to withdraw it for free. But if you can’t wait up to three business days, there’s a 1.75% fee to transfer your funds instantly.
advantages
- High shipping limits
- social element
- Free withdrawal option
cons
- 3% commission for sending money with a credit card
- Instant withdrawal fee up to 1.75%
cell
Zelle is another tool for sending money through many of the major banks. Zelle is more convenient if your bank offers this functionality. But you can download the app and enroll in this option with your Visa or Mastercard debit card.
Zelle’s bank-to-bank element is convenient. You may see your transfers clear in as little as 10 minutes.
Details of the transaction
If Zelle is offered through your bank or credit union, the financial institution will set your sending limit (and if it’s too low, you can ask them to increase it). For Zelle users who do not have a financial institution attached, your weekly sending limit is $500.
Zelle itself does not charge any fees for sending or receiving money. But check with your financial institution to see if they have added any fees for using Zelle with your connected account. Unless you have a free checking account, you may be paying bank fees that you can avoid.
advantages
- Zelle does not charge any transaction fees
- Quick settlement in your bank account
- Offered by most major banks
cons
- Not all financial institutions offer Zelle
- Relatively small payout limits
- You can only link one bank account to Zelle at a time
PayPal
PayPal might be the most recognizable name in the world of peer-to-peer payments. Although it was one of the original options, it is no longer the only way to send money between peers.
You can sign up for PayPal with just an email address and phone number. To withdraw cash, you need to link your bank account.
Details of the transaction
PayPal offers great shipping limits. Some users can send up to $60,000 in a single transaction. But if you’re new to PayPal, expect your limit to be $10,000 in a single transaction.
If you send money domestically from your PayPal balance or bank account, there is no fee. But if you send money domestically via credit card, it costs 2.90% + $0.30. When sending money internationally, there is a 5% fee for all types of transactions.
You can withdraw money for free with a linked bank account, but if you want your funds instantly, there is a 1.75% fee.
PayPal has also introduced cryptocurrency to the platform, but it still lacks the ability to trade shares or other investments.
advantages
- High shipping limits
- You only need an email address and phone number to set up an account
- You can invest in crypto
cons
- Fees are higher than other platforms for some transactions
- Instant withdrawal fee up to 1.75%
Which is the best for you?
When choosing between Cash App, Venmo, Zelle, and PayPal, there are many factors at play. The only way to narrow down your options is to determine what you’re really looking for in a paid app.
If you just want to send money between friends, then Venmo or Zelle might be the right choice. If you’re looking for a more robust financial services app, Cash App has more to offer.
Cash App has continued to develop a robust money app that can handle most of your money needs. Banking? Check. Invest? Check. Taxes? Check. If you’re already using your phone and doing banking, sending money, and checking stocks, it might make sense to do it all in one place.
Check out Cash App here to get started >>
