“Your kids will not know what money is,” said Apple CEO Tim Cook.
Cook’s prediction speaks to the payments technology that has created and perpetuated a trend of cashlessness. Today, carrying some extra cash has largely been replaced by P2P payments and eWallets.
As in any industry, payments have evolved over the centuries. We began using gold and silver coins, which gave way to paper money, then checks, credit cards, debit cards, NFC contactless payments, and now P2P payments.
What are P2P Payments?
Peer-to-peer payment apps are typically connected to an individual’s bank account, allowing you to send money to a friend, family member, or colleague with just a couple taps on a mobile device. This makes it easy to pay back what you owe for that latte or movie ticket.
There are a variety of P2P apps available for use (some of which are now associated with banks) and they’ve seen a sharp increase in popularity over the past few years, changing and expanding the ways in which people exchange money with one another.
How are P2P Payments Used?
Of all smartphone users, 46% regularly use P2P payment apps.These apps are most popular among millennials and Gen Xers, and they’re used to pay for anything from food and drinks to items like clothing and furniture.
The world continues to grow more mobile, so integrating a convenient, easy payment method into smartphones and other devices was a natural progression for the industry.
A recent survey found that nearly half of consumers prefer using digital payment apps over cash. It’s no big surprise. Sending money instantly is easier than going to an ATM to pull out cash and making change along the way. P2P payment apps simplify transferring money.
Are P2P Payment Apps Safe?
Just like with online banking and transactions, there are data security concerns surrounding P2P payment apps. Using a trusted app that features strict security protocols — like end-to-end encryption and tokenization — is in your best interests.
The most used P2P apps have risen to popularity largely because they are considered safe and secure, along with being incredibly easy to use. However, it’s a good idea to research an app before selecting it to make sure you feel comfortable inputting your sensitive data.
Do you regularly use P2P payment apps? What have been your experiences with them?