The peer-to-peer (P2P) payment field is booming, with customers transferring billions of dollars through mobile payment apps. Reducing the intermediary is becoming the norm for speed and lower fees. Making peer-to-peer payments using apps, such as PayPal, Zelle, and Venmo, fits into a mobile on-demand culture and will increasingly be an essential part of the economy.
As we have quite a bit of experience, we set out to bring you this guide on how to create a mobile P2P payment app. Let’s take a deep dive into mobile payment app development.
A P2P payment system acts as an intermediary that helps people transfer funds from their bank account to another person’s bank account using P2P applications. In short, you choose who you are sending money to and the amount of the transaction and then submit the payment. Depending on the P2P payment service you use, the time it takes for money to transfer can range anywhere from a few seconds to three business days. Many applications keep the money stored in the app until you release the money into your banking account.
Peer-to-peer apps have gained immense popularity among millennials, who generally show more trust in sharing their financial data with third-party software, compared to their less tech-savvy predecessors.
Peer-to-peer payments are also becoming more prevalent in business transactions. A remote employee or freelancer could be anywhere in the world, but traditional banks may not allow wire transfers to certain countries or may charge high fees. The P2P fund transfer makes the process so much simpler.
PayPal is one of the oldest and most trusted P2P apps, but there are numerous alternatives. To achieve a better understanding, we recommend you first to discover more about the types of P2P payment apps.
We have analyzed the following P2P apps: PayPal, Vemno, Dwolla, Zelle, Popmoney, Snapcash, Facebook Messenger, Google Wallet, Cash App, and Apple Pay. Let’s take a closer look at the following table that provides a summary of these ten systems.
|P2P Payment Apps||Bank-centric||Fees||Stored Value|
|PayPal||No Publicly held company NASDAQ: PYPL/||Send P2P using a debit/credit card: 2.9% plus $0.30 in fees if using a bank account (ACH)||Yes|
|Vemno||Yes Acquired by PayPal in 2014||Send P2P using a debit/credit card: 3% plus fees if using a bank account (ACH)||Yes|
|Dwolla||No Privately held by investors||None for P2P||Yes|
|Zelle||Yes||None for P2P||No|
|Popmoney||Yes||Send P2P using a bank account (ACH): $0.95 Credit cards not accepted||No|
|Snapcash||No Build on top of the Cash App||None Debit cards only||No|
|Facebook Messenger||No||None Debit cards only||No|
|Google Wallet||No||Send P2P using a debit/credit card: 2.9% plus $0.30 in fees if using a bank account (ACH)||Yes|
|Cash App||No||Send P2P using a debit/credit card: 2.9% plus $0.30 in fees if using a debit/prepaid/bank account||No Funds come directly from a bank account, sent directly to a bank account tied to a debit card|
|Apple Pay||No||$0 if the transfer is funded by a debit card 3% if funded by a credit card||Yes|
We compiled a list of must-have features to keep in mind when you develop your own custom P2P payment app.
If you want to develop a P2P app, you need to think about the following issues, which may present challenges. Here is what you need to know to build a P2P app and obtain all the perks while avoiding any possible downsides you may not be aware of.
Security is one of the essential issues in the mobile P2P payment industry. Because a large amount of private data are stored in one place, it is important to create a secured data record management system. Ensure that your P2P mobile app does not display a user’s credit card number during a transaction. It is best to implement fingerprint and PIN authentication in your app to approve transactions.
We recommend that every business dealing with confidential banking data should follow the PCI DSS compliances to ensure that the credit card data provided by cardholders are protected. To obtain a certificate, all businesses that store, process, or transmit credit card data electronically are required to follow the requirements below:
Note that your P2P mobile payment app should support the following payments types:
However, to engage your target audience, you may include the following features:
To prevent the overloading of your system, you could start building your P2P app as a cluster solution from the beginning. This will allow the capacity of your system to grow in proportion to its growing number of users.
There are 180 currencies across the world, and you should create a mechanism that tracks money conversion and transfers funds as soon as possible.
Just one second could cost your business a billion and could cause a higher abandonment rate. Note that native apps load e-commerce apps 10% to 20% faster than other apps. Consider this when choosing the technology for your payment app project.
Let’s determine which monetization model you can choose to boost revenue and drive your business growth:
Now that you have learned more about the monetization options, let’s look at how much it costs. Summarizing all the factors and making a crude approximation, a basic P2P app will cost around $50,000. However, it can be more expensive, depending on the team’s hourly rates.
Contact us, and we would be happy to provide more accurate cost estimates based on your project specifications and to outline the different content production options that are possible.