Have you heard of peer-to-peer payments yet or P2P? With smartphones and digital banking continually on the rise, a new way of paying one another has emerged. Peer-to-peer payment apps allow people to pay each other without the need for cash. Here is some more information about p2p systems and how you might use them.
Peer-to-Peer Payment Apps Explained
PayPal was probably the first P2P system that consumers used to pay one another directly and digitally. After that, many more banks, companies, and apps, like Venmo or Zelle, have come around to offer similar services. You do need a bank account linked to these apps for the money to be deposited or withdrawn.
One of the most common ways you might think to use this service is going out to eat with a group of friends. Rather than making sure you have cash or tell the wait staff to split the check a million ways, is to have one person pay for the entire bill. Everyone else can reimburse that person using a peer-to-peer payment app.
The applications for these apps can be whatever you might need. It may help when planning a vacation, contributing to a joint gift, even paying your portion of the rent. I’ve seen commercials where a consumer is able to buy from a bake sale using a P2P app.
For some, a service like this may help you keep track of your money better than with just cash. You can easily trace every dollar that you send around to friends and family. Finally, make sure to follow as many of the security features available to help shield yourself from scams and identity theft.
For more information on peer-to-peer payment apps, read Nerd Wallet’s review.