Putting perspective on P2P payments

P2P payments are coming. But who is using them?
Just how ready are we for instant P2P payments? It’s all the buzz in the financial world and players are scrambling to get in the space. P2P, or person-to-person, payments have been around for awhile. I started using them with PayPal for some eBay transactions years ago.  PayPal has advanced the P2P features over the years. If you haven’t tried their mobile interfaces then it’s worth your time


The original P2P payment

I tried to get some family members using PayPal for P2P payments, but….
When I suggested some family members try PayPal with me for some money exchange you would have thought I was speaking a foreign language. Maybe so, but I didn’t talk about the technology as much as I did the benefits: Instant payment, no cash,uses email address, no fees. Habits are hard to change, and that includes how we make payments to other individuals. At least with those in my circle of relationships it appears they are  making P2P payments with cash and check.

Are electronic P2P payments impersonal?
I wonder if wider acceptance is hindered because this type of payment is viewed as impersonal? Giving cash or writing a check forces an interaction. It’s giving something you have. Almost like a personal mark. Sending a P2P payment could be invisible. The recipient just receives an email with notification of receipt.

Or is it a trust issue?
It could also be that people don’t trust the delivery of the electronic delivery of a P2P payment.  Cash and checks provide a physical artifact representing the payment. I’ve heard some of the older generation in my family use this argument when talking about electronic bill pay. They like the paper trail it generates. It gives them a feeling of security and trust.

Reality is, we don’t make many P2P payments.
How often do we pay someone versus paying an organization or a business? For me, not much. Even as I think back to college and high school days, I don’t remember large number of money exchanges with friends. Most times people paid their share.

So when I put this in perspective. I think P2P payments are a good option to have for financial transactions. But they are just a small part of a full range of payment options that we’ll all need to conduct our daily transactions.

One Reply to “Putting perspective on P2P payments”

  1. My two very bright college graduates got very aggravated with trying to send me PayPal dollars. (One for a monthly auto loan and one for a monthly cell phone bill.) Both were “tricked” by PayPal hiding the personal (no-fee) choices behind the purchase tab. (See attached.) The personal payment options used to be out in the open. When PayPal made this change, I figured they were trying to generate more fees. Or it may have been attempt to make sure people paid merchants the right way.

    Both of the kids got very frustrated by the fees generated by not realizing they were choosing the wrong buttons.

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