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Banking 101: Where Can You Send Money Online?


Written by Lisa Iannucci | Updated on 4/12/2019

Note: This article is part of our Basic Banking series, designed to provide new savers with the key skills to save smarter.

Every once in a while, you need to send money online to someone — perhaps to your daughter for her broken-down car or to your friend who loaned you money for concert merchandise. There are many options available, and each one comes with its own format and fee schedule.

Options to send money online

Let’s break down some of the main options to send money online.

PayPal

Good option for people seeking transparency from a well-known company.

  • Background: It’s been more than 20 years since PayPal was founded in 1998. After multiple mergers and acquisitions, including being acquired by eBay, PayPal became its own publicly traded company in 2015. The San Jose, Calif., company has since purchased Xoom, iZettle and the mobile app Venmo.
  • How it’s used: PayPal is an easy-to-use website and app where you can send up to $60,000 to friends and family in a single transaction from a verified account, just as long as the recipient has a PayPal account, too. Sign up with your email address and connect it to your checking account, debit card or credit card (Visa, Mastercard, Discover or American Express). There are no fees to send money in the U.S. unless you’re using a credit card, debit card or PayPal Credit, at which point you’ll be charged 2.9% of the amount you’re sending plus a fixed fee. Fees for sending internationally depend on the payment method, country and amount you are sending, but they start at 2.9% plus $0.99 when using a credit card, debit card or PayPal Credit.
  • Important feature: The site sends money online instantly, so your kiddo doesn't have to be left stranded on the side of the road.
  • Downside: PayPal admits that scammers often try to impersonate the company to get access to your account. While this is a negative, the company does try to fight back with various tips on recognizing suspicious or phishing emails. Always stay alert.

Venmo

Good option for people who like a social experience during their transaction.

  • Background: Venmo was started by two former college roommates who just wanted to pay each other back. Braintree purchased Venmo in 2012, but then PayPal bought Braintree in 2013 for $800 million.
  • How it’s used: Simply transfer money from your Venmo account to the recipient’s Venmo account, as long as both of you are in the U.S. If you send money using your Venmo balance, bank account or debit card, there is no fee, but you are charged a 3% fee if you use a credit card. Venmo’s weekly limit to send to someone is $299.99 for an unverified account and $2,999.99 for one that’s verified.
  • Important feature: Venmo and PayPal seem very similar — and they are — but Venmo funds do not leave your bank account until your friend transfers the money to their bank account.
  • Downside: There’s an active social side to Venmo, which means that your friends can see exactly what you paid for — be careful! — and how much, unless you change your sharing options to private. Venmo encourages users to only use their app to send to people they know.

Cash App

Good option for people in the U.S. looking for convenience and flexibility.

  • Background: Formerly known as Square Cash, Cash App was unveiled in 2015 to easily send money to family and friends via mobile app, web or email.
  • How it’s used: Simply set up a $Cashtag name and account and you can start to send money online. If you send more than $250 in one week, you will be automatically asked for verification of your identification. Once you are verified, your sending limit increases to $2,500 in most states.
  • Important feature: Cash App has the ability to store money in a virtual account with a virtual routing and account number to receive direct deposits.
  • Downside: Cash App does not allow you to send money internationally. Both the sender and receiver must live in the U.S.

Zelle

Good option for people who want to transfer funds quickly without needing another app.

  • Background: Zelle was launched in 2017 and is owned by Early Warning, which is comprised of several major banks, including Bank of America, BB&T, Capital One, JPMorgan Chase, PNC Bank, U.S. Bank and Wells Fargo. Many more banks offer their customers the app as part of their services.
  • How it’s used: After enrolling your mobile number or email address to your bank account, you can start to send money online. If your bank or credit union uses Zelle, check to see if the limits differ. For example, USAA, via Zelle, limits three payments per day for a total of $1,000 (rolling 24 hours), $2,500 (rolling seven days) or $10,000 (monthly). Senders and recipients must have a U.S.-based bank account to use the service, but they do not have to be a customer at a participating bank to receive money. In that case, it may take a few days for the recipient to receive the money.
  • Important feature: The good news is that Zelle doesn’t charge a fee to send or receive money, but it recommends that you confirm with your bank about any extra fees that it may charge.
  • Downside: Zelle has had its share of customer complaints recently. It recommends that users make sure they have the right phone number or email before sending and that you speak to your financial institution if you have problems.

Google Pay/Google Pay Send

Good option for Android users looking for simple processes.

  • Background: Once upon a time, Google Pay was known as Google Tez, but it was rebranded and reintroduced as Google Pay in August 2018. It also replaced Android Pay. Separately, the Google Wallet app has been rebranded as Google Pay Send and is a feature within Google Pay in the U.S.
  • How it’s used: Similar to many of the other apps we’ve discussed here, Google Pay is as simple to use as opening your Gmail and clicking the $ or £ icon. Enter the amount you want to send and choose a payment method or add a new one. Choose attach money and send. That’s it. There are no fees to use Google Pay and you can send up to $10,000 in seven days. To use Google Pay Send in the U.S. to send money to family and friends, you’ll do so through the Google Pay app. Once you’ve entered your card information in the app and selected the person to which you will send the money, simply change the dollar amount from $0 and hit “send.” You will then get a confirmation screen (you may be asked for additional details the first time).
  • Important feature: Get that James Bond feeling with Google Pay’s fingerprint ID. Google also protects your privacy by generating a virtual account number and sending a one-time security code.
  • Downside: While Google Pay has more functionality, such as paying for purchases in stores and buying Google products, you can only send money to friends and family via Google Pay in India (via a separate app), the U.S. and the United Kingdom (web only).

TransferWise

Good option for people sending cash internationally who want a guaranteed rate.

  • Background: Many products are created out of necessity. When Skype’s first employee, Taavet Hinrikus, was working in London, he was getting charged high fees to transfer his salary from euros to pounds. So he created TransferWise, an online money order service, in 2011 with a partner.
  • How it’s used: TransferWise allows a maximum of $50,000 a day or $250,000 a year sent by an individual. Fees vary depending on the cost of the transfer, whether the transaction is made online or in person and whether it is being sent domestically or internationally. Your bank might limit the amount of money you can send per day or per transfer.
  • Important feature: TransferWise can send money internationally. Since international dollar rates fluctuate, the company guarantees your rate for up to 48 hours.
  • Downside: If you are not a verified account user before transferring money, it can delay the transaction, so get verified first.

Western Union

Good option for people who need to send money to multiple countries.

  • Background: Western Union started more than 150 years ago — 1851 to be precise. It was 1914 when it offered the first charge card. Today, you can send and receive money and pay bills.
  • How it’s used: Western Union allows a wire transfer of as much as $2,999 per transfer. Fees vary depending on the cost of the transfer, whether the transaction is made online or in person and whether it is being sent domestically or internationally.
  • Important feature: Western Union allows money to be sent to more than 200 countries.
  • Downside: In many instances, the only way to pick up the money is physically at a Western Union location.

MoneyGram

Good option for people looking for rewards when they send money.

  • Background: MoneyGram International started in 1940, and MoneyGram Payment Systems debuted in 1988. In 2004, MoneyGram became a publicly traded, individual company. It now has 350,000 agent locations in more than 200 countries.
  • How it’s used: Very similar to Western Union, there are more than 200 countries you can send to by using MoneyGram either online, through its app or at a MoneyGram kiosk. You can either pay with your credit or debit card, or from your bank account. The fees vary depending on the country to which you are sending and the amount. MoneyGram has a calculator on the site that you can use to estimate the fees.
  • Important feature: MoneyGram recently announced its new mobile app available for consumers in the U.S. and 14 other countries. The company also offers MoneyGram Plus RewardsTM, where your information is stored in the system and you will receive special offers and rewards.
  • Downside: Similar to Western Union, MoneyGram transactions cannot be reversed if you should change your mind.

Facebook

Good option for people who use the features of Messenger frequently.

  • Background: Did you know that Facebook is much more than a place to post photos and share what you had for lunch? Facebook, which launched in 2004, released Facebook Chat in 2008, and that ultimately became Messenger as we know it today. Through Messenger, you can send someone cash to pay for a product you bought from them or simply because it’s their birthday.
  • How it’s used: Sending money with Facebook is about as easy as sending a private message, and Facebook doesn’t charge for the service whether you are giving or receiving. So go ahead and start a message, and you’ll see the $ icon. Enter how much you want to send and press pay. The money will be sent from your debit card to theirs.
  • Important feature: It’s important to note that credit cards cannot be used.
  • Downside: Facebook Messenger payments are only available in the U.S., France and the United Kingdom. You cannot reverse the transaction once it is sent.

Making the best choice

We’ve broken down the options, but which is the best service for you? It depends on your needs. Do you need to send money online instantly? Do you not want to be charged fees? Does the recipient have an account with the service you are using? Do you need to send a large sum of money? Do you need to send money online once or regularly? Once you have the answers to these questions, you can narrow down your choices and select the best one for you.

Comments
Nice article
Nice article   |     |   Comment #1
A summary table would be helpful
deplorable 1
deplorable 1   |     |   Comment #2
First of all sending money in this way is a really bad idea particularly if you are paying fees to do so. I vote for PayPal though because it is the most useful of the bunch. It is useful because it provides a second layer of protection when making purchases online. You can link multiple bank accounts and credit cards and the businesses you purchase from do not have access to your actual account numbers while you still earn the credit card rewards for your purchases. They also have a shopping network of sorts through coupons you can activate. I had a issue with a purchase once and the credit card company failed to resolve the issue but PayPal came through and promptly gave me a refund.
RLLTX
RLLTX   |     |   Comment #3
Apple Pay Cash is the one that I use for sending/receiving money from family and friends. It's secure and as long as a linked debit card is used, there is never any fee.
Anonymouse
Anonymouse   |     |   Comment #4
This is a narrow-use case: Before my daughter went away to college, we opened a joint checking account at our local bank. We both had ATM cards and she had the checkbook. I verified the availability of no-fee ATMs near her campus. As the account balance dwindled, I topped it off. No fees, easy to use, worked for us.
Nothing
Nothing   |     |   Comment #5
#4 ...We worked up jointly her budget for 9 months...we used her USBonds (she filed her first tax return at 2 years to convert from cash basis taxpayer to accrual to recognize annual bond interest) to fund her checking acct --- she cashed annually the required bonds and we held on to and funded her monthly checking account based upon budget. This was many years ago and changed rules now. I recall another daughter saying she had an income issue once and needed more money...I said you have a budget issue, i.e. too many expenses, "cut them." It worked quite well for them.
anonymous
anonymous   |     |   Comment #6
With all these third party online/mobile funds transfer apps I'd be worried what would happen if the service provider gets hacked or acquired by a company that tries to monetize personal data. Also, what happens if I accidentally send the money to the wrong person, is it like handing out cash to a stranger? Who assumes the liability during the transfer process?

For all those reasons, I'd prefer to use joint accounts or ACH wherever possible. Otherwise, write a check or use the bank's "app" to send a check or make a payment.

These apps used to be useful to generate account activity for rewards checking accounts (pay $1 your spouse, put money back into account, repeat 10 times a month) but I think many of them monitor and disallow this activity now. Therefore, no longer useful to me.
51hh
51hh   |     |   Comment #7
Good start. Not that useful for normal savers (except for multiple-RCA holders), but some these options may find interest in the manufactured spending (MS) arena. :-)
Cracker
Cracker   |     |   Comment #8
The biggest problem with Zelle is you can only connect one bank account to it. For multiple accounts you would need a unique mobile number or email address for each one. It would be nice to have one Zelle account and be able to link all of your bank accounts to it. The way they are doing it now kind of defeats the purpose.

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