Tips for using peer-to-peer payment systems and apps

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Online peer-to-peer, or P2P, payment systems let you send money to people quickly. I’ve used them to collect money from the parents on my daughter’s soccer team and to send money to my brothers when we’ve bought a gift for a friend. Personally, I almost always know where my phone is, but I can’t say the same for my checkbook.

The use of these services is a growing trend—I just read an article that estimates there will be more than $700 billion in peer-to-peer payments in the U.S. in 2018. There are several mobile peer-to-peer apps out there already and banks are also getting into the game. If you use a peer-to-peer payment system, here are some tips to keep in mind.peer to peer payments

  • In many apps, when you receive a payment, the money is added to your P2P system balance. It’ll remain there until you transfer it to your bank account or use it for another transaction within the system. If you transfer the balance to your bank account, confirm that the deposit went through. The transfer could take a few days or even longer if it’s flagged for additional review.
  • Scammers try to get you to pay them in many different ways—including by sending money online—so make sure you know who you’re sending money to. If you use the service to receive money from someone you don’t know personally—maybe as payment for tickets to a concert or a game, or for an item you’re selling—transfer the money to your bank account and make sure the money is there before you send any goods. Read the terms of service if you’re not sure if these kinds of transactions are permitted on the service you use.
  • Peer-to-peer payment systems require access to your financial information, so check your account settings to see if you can enable additional security measures that aren’t on by default. Consider turning on multi-factor authentication, requiring a PIN, or using fingerprint recognition like Touch ID.
  • Some systems or apps might share information about your transactions on social media. Check social media permissions or settings—some may be set to share your information with everyone by default. Adjust your settings based on what you’re comfortable sharing.

Venmo, one of the players in this space, just reached a settlement with the FTC for some of its alleged practices. You can read more about it on our business blog.

Check out more tips from the FTC about steps you can take to protect your personal information online.

Comments

Excellent information, useful and important.

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Thanks as usual for the great info. Will pass on to my daughter and any other relatives and friends.

@DINAZ: You are being scammed. Please stop this practice. Someone is conning you. DON'T DO IT ANYMORE.

I get e mails supposedly from My bank, saying there is unusual activity going on, and they ask for all My personal information so I can use My account. I know this is a scam. I went into My bank statement, and everything is ok. If anything is wrong, My bank will call Me, but they don't send e mails

Scams are real, from health care to financial services scammers are attempting to get access to your personal data. Taking precautions is using payment aps should be a priority for consumers. I received at least two fake request from bank that where I done even have accounts. This

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