By Cleo Washington, Intern | Cleowash@umich.edu
Have you ever gone out with a group of friends and needed to pay for something? Whether it’s food, clothes, or gifts, one person often ends up paying for the group. In the past, friends would be reimbursed with cash; however, you can now repay them using online platforms.
Peer-to-peer (P2P) services allow two individuals to directly send money to each other in a streamlined process on their mobile devices.
In the money transfer app, you need to link your payment source, which is typically a personal bank account, debit, or credit card. Then, you identify the recipient, enter the amount you want to send, and confirm the transaction. After confirmation, the funds are transferred to the other person’s P2P account, while they are removed from yours.
Some of the most popular P2P services are: Venmo, Cash App, Zelle, PayPal, and Apple Cash. There are minor differences between these various platforms and the services they offer.
Venmo transactions are initially public, so make sure you set your activity to private; additionally, the app offers various debit cards (including a teen version). Cash App also offers a debit card, but it is differentiated by allowing users to invest in stocks and cryptocurrency on its platform. Zelle is most closely aligned with banks, as these institutions offer Zelle services within their banking apps. PayPal allows users to send money internationally (and has features that convert to foreign currency), and offers its credit line. Apple Cash is only available for Apple users, who can make purchases with its contactless payment system at retail locations.
Engage in safe practices when using these apps, just like you would with anything else. Only send payments to people you know, because transactions are complicated to reverse once funds have been sent.
So the next time you owe money to your friends, you can save your cash and use peer-to-peer services instead.
Author: cleowash
