{"id":128300,"date":"2019-02-18T18:08:31","date_gmt":"2019-02-18T17:08:31","guid":{"rendered":"http:\/\/sftarticles.wpenginepowered.com\/en\/?p=128300"},"modified":"2025-07-01T22:21:27","modified_gmt":"2025-07-02T05:21:27","slug":"why-are-money-apps-free","status":"publish","type":"post","link":"https:\/\/cms-articles.softonic.io\/en\/why-are-money-apps-free\/","title":{"rendered":"How payment apps make money without charging any fees"},"content":{"rendered":"

You may use Venmo, PayPal, or QuickPay to send your friends money after they picked up the tab for dinner or paid for the hotel room. Maybe you use them to pay your share of rent or utilities. These so-called person-to-person\u00a0(P2P) payment apps often don’t have transaction fees.<\/p>\n

These types of apps are on the rise. Last year, eMarketer\u00a0predicted<\/a>\u00a0that the number of people using P2P mobile payment products in the U.S. would rise 30 percent to encompass 82.5 million people.<\/strong>\u00a0So, how exactly do these peer-to-peer apps make money? That largely depends on the app.<\/p>\n

How payment apps make money without charging any fees<\/h2>\n

\"payment<\/p>\n

Making money<\/h3>\n

Everyone who uses apps is used to advertising banners and pop-ups within apps. It\u2019s how most apps make money. Payment apps, however, lack these obvious ways of advertising. Instead, these apps sometimes generate funding through transaction fees.<\/strong><\/p>\n

Venmo, for example, doesn\u2019t charge a fee to transfer funds through a major debit card or checking account. But they do charge a small 3% fee for any payments made via a credit card. Perhaps more importantly, Venmo is owned by payment giant PayPal, so even though Venmo\u00a0doesn\u2019t really make any money<\/a>, it extends the reach of PayPal, which makes a ton of money.<\/p>\n

\r\n
\r\n
\r\n
\r\n \"Venmo\"\r\n <\/div>\r\n
\r\n Venmo<\/span>\r\n download free \u25ba<\/a>\r\n <\/div>\r\n
\r\n <\/path><\/path>7<\/text><\/svg>\r\n <\/div>\r\n <\/div>\r\n
\r\n <\/span>\r\n <\/div>\r\n
\r\n \r\n <\/div>\r\n <\/a>\r\n <\/div>\r\n<\/div>\n

In fact, larger companies using payment apps as part of a broader strategy seems to be a trend. Square, the creator of the\u00a0Cash App<\/a>, is building an empire. In addition to the Cash app, they have payment products for merchants where they charge low fees and in return gain heaps of data.<\/strong> How will they use the data? Some financial experts suggest the data could be used to provide marketing recommendations that match specific users previous purchases. Only time will tell.<\/p>\n

Venmo and Cash are both owned by parents that would be classified as technology companies.\u00a0Zelle<\/a>, on the other hand, was originally developed \u2014 and is still owned \u2014 by a group of banks. Launching a product to compete with the likes of Venmo is a way for these banks to ward off competition from new, tech-savvy companies entering their industry.<\/p>\n

As you can see, the question for many\u00a0P2P payment apps isn\u2019t how much money they\u2019re making on their own, but how they fit into a company\u2019s larger strategy.<\/strong> It\u2019s worth remembering that in the long run, detailed data on when and why people send money to each other is extremely valuable<\/strong>, much more so than the money these companies would make charging small payment fees right now.<\/p>\n

\r\n
\r\n
\r\n
\r\n \r\n <\/div>\r\n
\r\n

7 best apps to manage your money \u2013 from cash to crypto<\/p>\r\n Read Now \u25ba<\/a>\r\n <\/div>\r\n <\/div>\r\n <\/a>\r\n <\/div>\r\n<\/div>\n

Person-to-person apps<\/h3>\n

People are no longer interested in carrying wads of cash when making purchases or during nights out with friends. Instead, person-to-person apps fill in the gap in a way that makes sense in this age of smartphones and online banking. How they make money varies, as do the ways they use your data, so always read the fine print<\/strong> when using one of these apps.<\/p>\n

If you\u2019re trying to figure out which payment app is best for you, take a look at this comparison between\u00a0Square Cash and PayPal<\/a>.<\/p>\n

Watch the video below for more information on person-to-person payment apps.<\/p>\n

\r\n

More from Softonic<\/p>\r\n

\r\n \r\n
\r\n
\r\n
<\/div>\r\n <\/div>\r\n
\r\n

How to learn about Bitcoin without actually investing in it \u25ba<\/p>\r\n <\/div>\r\n <\/div>\r\n <\/a>\r\n \r\n

\r\n
\r\n
<\/div>\r\n <\/div>\r\n
\r\n

Everything you ever wanted to know about Bitcoin (but were afraid to ask) \u25ba<\/p>\r\n <\/div>\r\n <\/div>\r\n <\/a>\r\n <\/div>\r\n

\r\n \r\n
\r\n
\r\n
<\/div>\r\n <\/div>\r\n
\r\n

The Best Bitcoin Apps \u25ba<\/p>\r\n <\/div>\r\n <\/div>\r\n <\/a>\r\n \r\n

\r\n
\r\n
<\/div>\r\n <\/div>\r\n
\r\n

An extensive guide to cryptocurrency trading \u25ba<\/p>\r\n <\/div>\r\n <\/div>\r\n <\/a>\r\n <\/div>\r\n<\/div>\n","protected":false},"excerpt":{"rendered":"

These apps may be free, but you could be paying with your privacy.<\/p>\n","protected":false},"author":9167,"featured_media":128301,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","wpcf-pageviews":2},"categories":[1015],"tags":[1714],"usertag":[],"vertical":[],"content-category":[],"class_list":["post-128300","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-payment-apps"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/cms-articles.softonic.io\/en\/wp-json\/wp\/v2\/posts\/128300","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/cms-articles.softonic.io\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cms-articles.softonic.io\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cms-articles.softonic.io\/en\/wp-json\/wp\/v2\/users\/9167"}],"replies":[{"embeddable":true,"href":"https:\/\/cms-articles.softonic.io\/en\/wp-json\/wp\/v2\/comments?post=128300"}],"version-history":[{"count":1,"href":"https:\/\/cms-articles.softonic.io\/en\/wp-json\/wp\/v2\/posts\/128300\/revisions"}],"predecessor-version":[{"id":326566,"href":"https:\/\/cms-articles.softonic.io\/en\/wp-json\/wp\/v2\/posts\/128300\/revisions\/326566"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/cms-articles.softonic.io\/en\/wp-json\/wp\/v2\/media\/128301"}],"wp:attachment":[{"href":"https:\/\/cms-articles.softonic.io\/en\/wp-json\/wp\/v2\/media?parent=128300"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cms-articles.softonic.io\/en\/wp-json\/wp\/v2\/categories?post=128300"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cms-articles.softonic.io\/en\/wp-json\/wp\/v2\/tags?post=128300"},{"taxonomy":"usertag","embeddable":true,"href":"https:\/\/cms-articles.softonic.io\/en\/wp-json\/wp\/v2\/usertag?post=128300"},{"taxonomy":"vertical","embeddable":true,"href":"https:\/\/cms-articles.softonic.io\/en\/wp-json\/wp\/v2\/vertical?post=128300"},{"taxonomy":"content-category","embeddable":true,"href":"https:\/\/cms-articles.softonic.io\/en\/wp-json\/wp\/v2\/content-category?post=128300"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}