I’ve mentioned the impact that technology is having on finance before. While there are multiple different ways that technology is changing the financial landscape, it’s biggest influence can be seen in the world of mobile applications. One budding category of financial innovation is peer-to-peer payments. In essence, peer-to-peer payments allow users to send money to friends, family or colleagues quickly and securely.


One of the oldest and most recognized peer-to-peer payment services is PayPal. Founded in 1998 as Confinity, PayPal allows for online transfers of money, and became incredibly popular with the rise of the Internet. In fact, the company is still quite popular and currently has a revenue stream of over $10 billion.


As our society continues to rely heavily on smartphones, mobile applications have almost become a necessity. And with that necessity comes opportunity. And multiple companies saw the opportunity to take their online peer-to-peer payment services and bring them to the mobile market.


This is an industry that has been flooded with a variety of companies, including Google Wallet, Circle and Square Cash. The most popular of these is Venmo. The premise of the application is simple: simply connect your bank account to your Venmo account, input the amount of money you would like to send, and transfer it to whomever you desire. Venmo’s true popularity lies in its social media features. Users can upload profile photos, follow friends and even comment on money transfers. The ease-of-use and social media functionality of the application have made Venmo incredibly popular among millennials.


Peer-to-peer payments have become so popular among younger audiences that social media and messaging applications are beginning to utilize the service. The image and video sharing service Snapchat has recently unveiled its version of P2P payments called Snapcash and Facebook Messenger, one of the most popular messaging applications in the world, also has its own variation of the service.


To drive the point home, even software developers are implementing the power and ease of P2P payments into their mobile operating systems. Just this week, technology giant Apple announced the implementation of a P2P payments service in their iMessage application. The service works through Apple’s Apple Pay service, and is end-to-end encrypted, so all information is kept incredibly safe. Users will simply need to connect an account, open up their messaging application, select an amount and send.


As technology gets more advanced and as we depend on it more and more, we will start to see the implementation of P2P payments everywhere around us. It is already happening. The most important thing to remember is to be smart about how your are using your money. Always keep a record and have an idea of how much you have in the bank.