Probably the best known being PayPal, peer-to-peer payment systems and apps are growing in revolutionary ways. Let’s have a look at a relatively new one: Venmo. (On the courtesy phys.org)
On a trip to Maine with four friends, Alexander Culbertson racked up $1,300 on gas, hotel rooms, food and drinks.
But instead of splitting all of the weekend’s activities evenly throughout the trip, one person paid for everything. Then, later they all split the final bill using Venmo, an app that lets users pay with a tap and a text-like message.
“It would have been a nightmare for all of us to evenly split every transaction,” says Culbertson, 26, a Boston advertising executive. “If you say ‘I’ll grab beer and you grab the groceries,’ things usually don’t come out as planned. “This kept things easy.”
Person-to-person mobile payment services like PayPal-owned Venmo are catching on as a way to bypass searching for an ATM or splitting a bill on multiple cards when the dinner check comes. And they’re particularly popular among millennials, a generation that seems to have their own way of doing everything.
For Dan Callahan, 22, a digital marketing manager in Philadelphia, using Venmo means avoiding the awkward situation of nagging his roommate for rent since you can request payment via the app.
“I write the checks or pay online for our rent, utilities, and anything else, and at the end of each month, I total it all up and he sends me half,” Callahan said. “And it’s all free. Beats having to get ATM charges from my bank and dealing with cash!”
The services also are growing quickly: Venmo is seeing four times the growth this quarter as it did last year. The service processed $2.4 billion in transactions in 2014 and $1.3 billion last quarter alone. Similar services abound, including Snapcash on Snapchat and Square’s Cashtags which can be used via tweet or text.
It’s still just a sliver of total spending online—which Forrester predicts will reach $334 billion in 2015. But the peer-to-peer payment services are catching on with some more quickly than so-called digital wallets like Apple Pay or Samsung Pay.