Peer-to-Peer Payments
P2P payments, also known as Peer-to-peer payments, are transactions used to split a $40 dinner bill between friends or to pay your rent. These payment services allow the transfer of funds between two parties using their financial institution accounts or debit cards through an online or mobile app. Payment services, like Venmo, Zelle, Cash App, and Facebook P2P Payments in Messenger, make sending funds just as easy as paying with cash. However, you should only use these services when you are paying someone, you know. Here are some tips to keep in mind.
Best Used Among Family and Friends
To lower the risk of being victimized by fraudsters, only use P2P transactions with people you know. Don’t use P2P payments to pay for items you purchase from unknown sellers online. Most peer-to-peer transactions are irreversible, a fact scammers are known to exploit.
Once you send funds, you will be unable to get your money back. If you mistakenly choose the wrong person in your contact list or enter the wrong number, it cannot be stopped or reversed.
Understand the Risks
Because a third party completes P2P transactions, the Credit Union may not have info about these transactions, even if they involve Credit Union accounts. Also, P2P payment service providers are only responsible for transferring the funds. Once the funds are authorized and received, they are no longer responsible for the transaction. If you paid for something but didn’t receive it or received damaged goods, you are usually on your own when it comes to a dispute. Before using a P2P service, research the provider’s customer support policies, so you know what to expect. While these transactions are very convenient, you should view them as cash payments that can’t be retrieved.