Increasing The Power And Penetration Of P2P Payments
October 4, 2021
In a year when life experiences were defined by physical separation and virtual connection, it’s no surprise that the same trend dominated payments.
Unable to exchange cash in-person or visit a bank to cash a check, people turned to mobile to send to and receive money from one another. In fact, a recent study found that nearly 80% of consumers used person-to-person (P2P) payments over the course of the last year.
While people have used P2P payment apps for years, this is an astounding rate of penetration. Anecdotally, the number of both users and use cases rose during the pandemic. From paying for virtual services to patronizing delivery apps, instant mobile payments became an easy, routine payment consideration for many people.
However, even with this high rate of adoption, there are still barriers to ubiquity and untapped opportunities in the sector. For mobile P2P payments to move from a “nice-tohave” convenience to a “must-have” standard, the industry needs its Esperanto.
Current mobile P2P payment apps operate much like the dawning days of instant messaging. In the early 2000s, users of AOL, Yahoo!, ICQ and others could only message friends and families on the same platform.
Similarly, today, you can only send and receive money if the two parties are using the same app.
Looking to pay your piano teacher or your fantasy football league dues using PayPal, but they only have Venmo? It’s an impossible transaction to complete unless one of you downloads the other app, creates a profile, then links their bank account. For instant P2P payments to become as simple and ubiquitous as swiping a credit card at checkout, they must connect to one another using the payments equivalent of a universal language.
That is fast becoming a reality with the launch of the new Ingo Money open-loop P2P network. The industry’s first pay-anyone, cross-platform P2P money transfer network can reach 4.5 billion consumer accounts – including credit, debit and prepaid cards as well as digital wallets and bank accounts – making it possible to instantly route money to anyone, natively.
That means Sally can send her share of the rent to her roommates from her bank’s app and have it arrive in their bank accounts. Ditto for her sister’s credit card for Sally’s share of lunch, and again into her yoga instructor’s Venmo account – simply by selecting them as recipients. The network does the rest.
As more apps and businesses tap in, open-loop P2P payments have a chance to become the default P2P payment option for consumers. With 97% of Americans owning a cellphone and 85% a smartphone, the power to pay anyone, anywhere is literally in the palm of nearly everyone’s hand.
CEO at Ingo Money
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