What is a Person-to-Person (P2P) Payments App?

A P2P payment app is a service that allows one user to send money to another using an app or website. P2P apps are linked to your deposit account or through your debit card. Payment apps include PayPal, Venmo, Cash and many others.

Transactions include anything from splitting a dinner bill, to paying rent, or contributing to charity. Some P2P apps are built in to or available through mobile banking apps or smartphones. Most are available as stand-alone apps that can be downloaded. You can even send money through Facebook Messenger by adding a US-issued debit card to your Facebook profile.

Benefits Each mobile payment app has its own advantages and limitations; choosing one depends on the features you want. For example, a P2P app available through a mobile banking app may only allow you to send or receive money from someone who also has an account at that institution. Some apps may have a processing delay and others may charge a small processing fee.

Choosing an App You may be asking yourself, “How do I choose the right app? Is one safer than the others?” Do what most folks do and ask friends and family for recommendations. Look for a service that encrypts transaction data and complies with Payment Card Industry Data Security Standard (PCI DSS).

P2P is flourishing due to the convenience of being able to immediately and safely send and receive funds, pay bills and make purchases anytime, anywhere.