How Can I Transfer Money Online?
Technology has made life simpler and more efficient in so many ways, including the way we handle and manage our finances. Even just a decade ago, sending money to friends and family usually meant writing a check and dropping it in the mail. Snail mail then took days to arrive, which made the option useless in an emergency. If someone needed the money quickly, you had to pay outrageous fees to send a wire transfer from one bank to another.
Fortunately, the days of waiting — well, days — for money to arrive are long gone, and we can now send money in mere minutes — sometimes even seconds — thanks to modern money transfer technology available online and through various mobile apps. Whether you want to send a few bucks or several thousand dollars, you can complete the transaction in less time than it used to take to write a check. Here’s a look at a few of the best ways to transfer money online.
Smartphone Money Transfer Apps
If you need to quickly transfer a small amount, you won’t have to look any farther than your smartphone in most cases. Money transfer apps are plentiful, and you can usually register and send money within minutes. However, keep in mind that some apps are certainly better than others in terms of fees and speed. Additionally, for the fastest turnaround time, the person receiving the money needs to already have an account set up on the app. Some apps will notify the recipient to set up the app to receive the funds, but this slows down the process.
Transferring money online often comes with fees, but there are exceptions when you take the right steps and choose the right apps. Be sure to carefully review the terms and conditions before using any money transfer app, so you know exactly what to expect. Venmo, Zelle, Google Pay and PayPal are top contenders that offer excellent features at little or no cost.
Venmo: As a top-rated, peer-to-peer (P2P) money transfer app, Venmo focuses exclusively on transferring money between family and friends. Both parties involved in the transfer must have Venmo accounts, and transfers can only be initiated on mobile devices, not via the website. On iOS devices, you can even use iMessage and Siri voice commands to send payments. If you send money using your credit card, a 3% fee applies. It costs 1% of the transaction amount to instantly transfer money you receive to your debit card. Otherwise, a free transfer takes one to three days.
Zelle: Designed to seamlessly integrate with most online banking apps, Zelle earns top marks for the speed of its free transfers directly into recipients’ bank accounts. Depending on your bank, you may already have access to Zelle through your banking app, or you can easily set up the Zelle app yourself. When you receive money via Zelle, the funds transfer to your bank account without you lifting a finger — and without charging you a dime. When you use the app to send money, the recipient is notified of the transfer and instructed how to proceed.
Google Pay: Besides offering fast transfers that rival Zelle, Google Pay attracts a huge client base by offering completely free transfers made with debit cards and bank accounts. On the downside, you can’t send money using credit cards. Recipients who don’t already have Google Pay accounts will have 14 days to claim the money. Additionally, they will have to set up a Google Pay account and attach a bank account for transfers of more than $2,500. Single transfers are capped at $10,000.
PayPal Money Transfers
PayPal has been a trusted icon in the online payment industry for many years. The massive third-party payment service safeguards internet purchases all over the world, but it also helps you take care of personal payments to family and friends in just a few clicks, completely free of charge if you transfer the funds using your bank account or PayPal balance. A fee of 2.9% plus $0.30 applies to payments made by credit or debit card.
To send money for free, enter the recipient’s email address or mobile phone number and then enter the amount to send. Be sure to verify the type of payment indicates “Sending to a friend” underneath the payment amount. If the payment type is set as “Paying for an item or service,” you will be charged a fee to send the money, regardless of which payment method you choose. You then scroll down to set your payment method and send the money.
If you receive money yourself via PayPal, you can transfer the money to your bank account free of charge, but it will take one to two days for the funds to clear. You can pay a 1% fee ($10 maximum) to transfer the funds instantly to your bank account. PayPal also has a service called Xoom that allows you to send money to bank accounts or in-person pickup locations all over the world. You pay a fee for this service, but the recipient does not, and they are not required to have a PayPal account to receive money.
Online Bank Transfers
You can still choose to keep it partially old-school by sending money to a loved one or friend through your bank’s online portal. Fees for modern bank transfers are usually much lower than in the past, although this can vary by bank. If you’re transferring money to someone who also has an account at the same bank, some banks may complete these transfers without charging any fees. If the transfer is going to another bank, you will have to provide relevant details about the account, such as the account holder’s name and address, the account number, and the routing number.
Western Union, MoneyGram and Other Money Transfer Services
Money wire transfer services have been around for many decades and are secure, trustworthy ways to send money — as long as you stick to names you recognize like Western Union and MoneyGram. The fees for these services tend to be high, but they offer a key advantage of allowing you to easily send money to someone who doesn't have access to a bank account. Instead, the recipient picks up the money at a designated location. These services also allow you to transfer money to inmates at correctional facilities, something that bank transfers and smartphone apps can’t do.