It is less frequent for people to carry around cash nowadays, which can pose a problem in situations such as dining out in a large group and not wanting to overwhelm the server by splitting the bill several ways. Or you want to give your little brother $20 but he lives across the country and writing a check and putting it in the mail seems like a hassle. These and other problems have been solved with the help of modern technology, with apps specifically designed for money exchange.
Some are apprehensive about this form of exchanging money. After all, many of them require that you give sensitive information when you sign up, which is understandably a cause for wariness. If you are interested in using an app to send money to friends, rather than hitting the ATM or writing out a check, here are the more commonly used, reputable apps, and how they differ from one another.
PayPal.me: If you simply want to exchange money amongst friends and family, the typical PayPal account might be a bit cumbersome and time consuming (funds are often held for up to a month until you are considered a reputable ‘seller’). To address the need for simpler money exchanges between peers, PayPal developed PayPal.me. Users get their own URL, which is free to set up. You can access your account on your phone or computer.
In order to receive your money, you just need to connect the bank account from which you’d like to send/receive payments (credit cards come with a 2.9% fee, which most people want to avoid). Money will remain in your PayPal Balance until you decide to deposit it.
Google Wallet: All you need to send money via Google Wallet is a bank or debit card to attach to the account (banks can take up to 3 days to process payment while debit cards are a matter of minutes, but at a 2.9% extra cost). Once it is setup, all you have to do is send a message with a subject and click on the cash symbol.
Venmo: Similar to PayPal.me (after all, both are owned by PayPal), Venmo has a similar system of requesting/sending money, but it’s interface is more social. For instance, unless you set your transactions to “private,” friends can see all transactions that you’ve posted. You can also write whatever you want as the title of the transaction (from “rent” to something with several emojis), making it a popular choice among millennials. While the fees and setup are the same as PayPal.me, the credit card fee goes up to 3%.
Be careful with leaving your phone lying around if you have Venmo. If you don’t manually log out of the app, anyone with access to your unlocked phone could get into your account.
Facebook Messenger: If you have Facebook Messenger, you may have noticed the dollar sign symbol in your chat window. All you have to do is store a card (one time setup through Facebook), create a pin, and you can send money to friends in the app.
While convenient and free, this app has the least amount of security of the five listed. If you do not have two-factor authentication setup on your Facebook account, it may not be a good idea to send money this way. It’s best you fully understand your Facebook settings before doing this: https://www.facebook.com/help/413023562082171?helpref=page_content.
Square Cash: Like Venmo and PayPal.me, Square Cash is free to use as a personal account, with 3% charges on credit cards. It’s easy to setup and use, and you don’t need to have the app on your phone. To see all the different ways you can send money via Square Cash, their website has a pretty extensive list of complete instructions. You can also set up automatic cash outs whenever someone sends you a payment, rather than manually transferring each time someone pays you.
In terms of security, like Venmo and Facebook Messenger, it’s best not to send money to strangers with this app. Instead, you may want to consider signing up for the business app which costs 1.9% per transaction (a low percent, compared to many other apps) for an added layer of security. https://squareup.com/help/us/en/article/5187-getting-started-with-square-cash
No matter what money exchanging app you decide to use, keep in mind our cybersecurity tips, as well as these other tips, if you decide to use one of these apps:
- Only use apps that are available in your phone’s app store.
- Keep all of your passwords protected and updated
- Never exchange money with someone you don’t know
- Remember to log out or lock your devices after using one of these apps.
Sending and receiving money has gotten easier with technology and these apps are just another step in that direction.