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Transferring money to friends and family can be difficult and expensive. Cash App makes it easier to send money to friends and family, split the bill at restaurants, and make payments. In this Cash App review, you will learn everything you need to know about the app. And how to use it.
What is Cash App?
Cash App is a peer-to-peer or P2P payment app that allows users to send and receive money. Square Inc. created the app in 2013, and you can download this app on android and iOS phones. It is one of the most popular payment apps on the market. With over 30 million users, the app doesn’t just allow you to send and receive money. Users can make purchases and invest in Bitcoin. In the US, users can get a Cash Card to use their balance to pay for goods online or in the store. You can also make ATM withdrawals.
What are the Advantages?
There are many advantages to using the app. Not only can you send and receive money, but you can also use the app as a bank. The app will give you an account and routing number so you can receive direct deposits and pay your bills.
You can get a debit card and make purchases online and in physical stores. If you want to make payments with your debit card, they will not charge you a fee.
Some other advantages include:
- Free money transfers, good to transfer money to friends
- Opportunity for investments and bitcoin
- Transactions are encrypted
- Free design customization
Are there Any Disadvantages?
While the app can be beneficial, it falls short in some areas. You can use the app as a bank. But unlike with a real bank, your money is not FDIC insured. This means that your balance inside the app is not protected. You can take the balance and transfer it to your bank or your bank-issued debit card. But until you do, your money can be lost.
With a traditional bank, your money can earn interest, but this isn’t the case with the app. Some other disadvantages include:
- Using your debit card at the ATM comes with $2 fee
- There’s a $310 ATM withdraw limit
- Sometimes the transfers aren’t as instant as you may like
- If you run a business, using the app is not ideal
How Does it Work?
With the app, you can do one of four things: receive money, send money, banking, or invest.
How to receive money
When you download the app, you connect it to your phone number and a debit card. You will also need to create a username. For someone to send you money on the app, they need to have it installed on their phone too. The person inputs the amount they want to send and presses the pay button. They can search for your username or scroll through their contacts and find your name. Once they have selected your name, they can send the money.
You can also request money from the contacts on your phone that have the app. When you receive funds on the app, it is placed in your account on the app first. Once it is there, you can transfer it to your debit card or bank account. Or you can leave it on the app and request a Cash Card.
How to Send Money
If you want to send money or someone has requested money from you, all you need are one of three things: their email address, phone number, or their $Cashtag. The $Cashtag is basically the person’s username. When you find the person you are sending money to, the app will ask where are you transferring the money from. You can use the balance on the app, a bank account, debit card, or credit card. While you can use a credit card to send money, there is a 3% transaction fee. But if you use your debit card or bank account, it is free.
Mobile Banking
Not only can you send and receive money, but you can also use the app as a bank. You can have your paycheck deposited and ask for a Cash Card to make purchases using your balance. By using the app for direct deposits, you can have access to your money at least two days faster than usual. While this feature can be beneficial to some, you have to remember the money is not protected. Federal Deposit Insurance Corp coverage ensures that your money is protected regardless of what happens to the bank.
Investing
For $1, the app allows you to invest in stocks without having to pay any commission fees if you live in the US. The app even supports bitcoin, which you can sell and buy. To take advantage of this feature, you need to input your name, birth date, address, job information, and Social Security number.
Fess Associated with the app
Mostly, the app is free, but there are some fees associated with the app depending on what you do.
- If you want to withdraw your money as soon as you receive it, there is a 1.5% transfer fee. If you wait three days before withdrawing the money, it is free.
- If you have a Cash Card, there is a $2 fee.
- There is no commission fee when buying stocks, but some government agencies may require certain fees. If so, these fees will be added.
Is It Safe?
The app is safe, but you should still be careful. Your payment information is encrypted. The app sends all transactions and information through secure servers.
That being said, this app is on your phone. A lot of things can happen to your phone. You can lose it. It can be stolen. And if someone gets their hands on your phone and there is no security lock on it, that person will have access to your balance on the app. They will also have access to your account information.
Also, once you send money, you can’t cancel the payment. When you send money to someone, make sure that you get their $Cashtag correct. Make sure you know who you are sending money to.
Because the app is relatively new, there has been an increase in scams associated with the app. For example, sellers will say they only accept Cash App, and then once you send the money, they disappear, and you never get the product. Check the Better Business Bureau regularly so you can stay abreast of any new scams associated with the app. If you know what is out there, you can know when someone is trying to pull something.
Can it be used internationally?
Not really. The app can transfer money in the US and the UK, but that’s about it. It doesn’t work in Canada or other parts of the world. The app can convert payments from GBP to USD and vice versa, but that is it.
FAQ
Is it legitimate?
Yes, the app is legitimate. That being said, you should still be careful when using it. Just like with everything else, scammers have found a way to trick users into losing their money. You should still take precautions when sending money and protect your phone if it falls into the wrong hands.
Do you have to have a bank account?
Not necessarily. Instead of connecting the app to a bank account, you can leave it in the app. By doing this, you can request a Cash Card to make purchases. You don’t need one to send money either. You can use a credit card to send money, but this method comes with a fee.
How can you withdraw funds?
If you want to transfer your balance, click the cash out button. You can specify how much you want to withdraw and where you want to send the money. For an instant transfer, there is a 1.5% fee. But if you wait to cash out three days after you receive a payment, the transfer is free.
How much and I allowed to send?
That depends on how much information you share with the app. If you input your name, birth date, and the last four numbers of your social security number, you can verify your account. This allows you to send more money. If you don’t want to do that, you can send $1,000 every thirty days. If you aren’t transferring a lot of money every month, it’s probably not a big deal. But if you do, it is something to think about.
The Cash App has made sending and receiving money a lot easier. Having dinner with your friends and need to split the check? Use Cash App. Have a friend or family member out of town that needs some cash? Use Cash App. Have a college student away from home that needs a few dollars for some food or gas? Use Cash App. While the app has its limitations, there are some aspects that could be quite beneficial to users.
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