When cash used to be king, people exchanged cash or paper checks to settle debts. But times have changed. Whether paying the babysitter, splitting the rent with a roommate or sending a birthday card to the grandchildren, electronic forms of payment are increasingly used instead of cash or check. And one of the most popular electronic forms of payment is person-to-person (P2P) payments that allow funds to move from one person’s bank account (payer) to another person’s bank account (payee). But when it comes to sending money, security is always top-of-mind.
According to a 2017 eMarketer forecast, the transaction value of all U.S. P2P payments will exceed $156 billion in 2018 – rising to more than $244 billion by 2021.
To keep up with consumer demand, PNC, together with a group of U.S. banks, launched a P2P payment network called Zelle® in 2017.
P2P payment capabilities are convenient, easy to use and offer fast transactions when the recipient is registered with the network. They are popular among consumers needing to split a lunch bill, share the cost of a ride, or pool together on a coworker’s gift.
“While P2P technologies can be a great way to send money to people you trust, as with any financial product, there are bad actors who seek to part consumers from their money with creative scams using this technology,” said Tom Trebilcock, senior vice president of digital at PNC. “Consumers need to be careful that they’re using electronic payment systems in the safest possible way.”
Consumers should always read the P2P terms carefully to understand what, if any, recourse is available when payments are misdirected or made in error. Overall, it’s important to trust your instincts when using P2P payments, Trebilcock says. He offers three tips when using P2P payments:
- Stick to people you trust – Only send money to family, friends, and acquaintances you trust. While it may seem convenient to pay a third party for your latest internet purchase online, most P2P services, like Zelle, don’t include purchase protection. Once payment is sent, it is irrevocable and there’s no guarantee that you’ll receive the item you’ve paid for.
- Pay attention to detail – Using P2P services to send money to a known email address, telephone number or username is convenient, quick and generally safer than cash. But one wrong number or a misspelling can send your money to an unintended recipient. If this happens, both the sender and recipient must agree before the payment, made in error by the sender, can be reversed and even then, there’s no guarantee that your money will be returned.
- Consider it cash – P2P payment services allow users to send money to people you trust in real-time, without the burden of carrying cash. But like cash, using a P2P payment service allows recipients nearly instant access to the money, with little opportunity for the sender to recall the funds if they were sent in error by the sender. So if you’re sending $100 for your share of mom’s birthday gift, treat it like you’re hand-delivering a $100 bill. And make sure you’ve entered $100 and not $1,000 by mistake.
“When used as intended, P2P services offer a quick, convenient and safer way to make payments to those you trust without the need to have cash on hand. By paying attention to detail, consumers can help to ensure those payments make it to your friends or family and out of the hands of cyber-scammers,” said Trebilcock.
Learn more about using Zelle® at PNC »
Tom Trebilcock is a senior vice president of digital at PNC
eMarketer projected that by the end of 2017, 63.5 million U.S. adults would be using P2P payment apps at least once per month.
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1. "P2P Payment Transactions to Exceed $120 Billion This Year," eMarketer, July 2017 https://www.emarketer.com/Article/P2P-Payment-Transactions-Exceed-120-Billion-This-Year/1016187
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