Popmoney is a payment service that allows people to send, request and receive money directly from their bank account. The service makes peer-to-peer transfers as simple as sending an email or text.
As a background, Peer-to-peer transfers are electronic money payments made from one person to another through an intermediary payment application.
These came on the scene in a major way with the birth of eCommerce and the need to facilitate payments between customers and sellers – most notably with online retailer eBay.
PayPal, which was later acquired by eBay in 2002, was the first mover in the space and certainly not the last. This acquisition and the growth of eCommerce in general spurred a boom in both online P2P transactions and competing applications facilitating them.
Today, there are dozens of peer-to-peer (P2P) payment apps out there to choose from.
And although Popmoney is not a first-mover nor a flashy up-and-comer, they are one of the largest in terms of institutional banking partners and wide-spread usage.
Developed by CashEdge in 2010 and now owned by Fiserv, Popmoney has gone through a series of changes in the past decade.
Let’s start with CashEdge. The brand name was absorbed when they were acquired by Fiserv, but I personally still have nightmares about using their data aggregation software back in my financial advisor days. Even their primary partner, Albridge, abandoned them in the end.
That’s not to say that Popmoney provides a bad experience because they were developed by CashEdge, but I went into this review with a bit of a bias just as a matter of full disclosure.
A History of Partnerships and Integrations
Fintech applications are built to be sold. It’s the reason that financial software companies exist. They build a product, market it for a while to grow a client base, then sell for as high a valuation as possible. That has happened several times over with Popmoney.
The first acquisition is the most obvious and it has nothing to do with P2P applications. Fiserv bought CashEdge in 2011 to compete with data aggregation rival ByAllAccounts, which has since been sold to Morningstar. This gave them Popmoney, but that was not their target.
The move did prove beneficial, though. Popmoney was connected to a number of larger banking institutions, so they melded it with their existing P2P provider, called Zashpay, which already connected to 1,400 banks. The combined entity stayed under the Popmoney brand.
If you’re wondering about the name, it stands for “Pay other people money.” That’s pretty direct and could have benefitted from the services of a clever marketing firm, but that never really developed. Fiserv has always treated P2P as secondary to their aggregation services.
On April 17, 2013, Fiserv announced the launch of a new “Instant Payments” feature in their Popmoney application, placing them in a space that had been dominated by Paypal for decades. Venmo was still in their formative years and Zelle had not been launched yet.
The Basics – How Popmoney and Other Electronic Transfers Fundamentally Work
To understand how Popmoney works, the first step is to go over what an electronic funds transfer (EFT) is. The concept goes back to 1870, when Wells Fargo first started sending money using their telegraph lines. The Federal Reserve Bank adopted the practice in 1910.
In 1972, the need for batch transactions led to the development of the automated clearing house (ACH), which is how most commercial bank wire transfers are done today. This is how P2P applications like Popmoney move cash.
Unlike Paypal or Venmo, the money moved through Popmoney has to be in the sender’s bank account before the ACH can be initiated. The payment can then be made by sending to the recipient’s email address or mobile phone number.
The application is designed for person-to-person transfers, but Popmoney also offers commercial accounts. The commercial account is advertised as a “full featured” electronic invoicing platform but it’s debatable as to whether or not they live up to that name.
Essentially, it’s a stripped-down basic service that doesn’t even provide any type of reporting or accounting. You can set recurring invoices, but you have to export them to Excel to run transaction reports.
As for the personal P2P app, I downloaded it from the App Store for my iPhone and found it to be pretty bare bones as far as features go. That’s not necessarily a bad thing, since all you really want to do is send and receive money, but I was expecting more from a ten-year-old app.
Processing Time for Sending and Receiving Payments
Having run small businesses for nearly three decades, my experience has been that an ACH should take no more than forty-eight hours to show up in your bank account. Popmoney takes up to three business days.
For the quickest transfer of funds, the sender must submit a payment via his/her debit card by 5:00pm PST and the recipient must accept it by 10:00pm that same night. In this instance, funds will take just 1 business day to transfer.
If you need to transfer money instantly, you might want to try another application.
A deeper dive into customer reviews show a number of complaints on the wait time as well, and even several instances where funds seemed to have been “frozen” after transfer, getting lost in limbo for a period of time before they could be sorted out.
The app itself scores just 1.5 stars out of 5 on the IOS App Store and just 2.3 stars out of 5 on Google Play with a significant portion of the 1 star ratings citing the slow transfer time. As of the time of this writing 484 individuals have reviewed the app for IOS and 1,328 for Android.
Of course, Popmoney is not alone in this. I’ve seen similar issues with Zelle and even worse with Paypal, who regularly freezes money for “security” checks. Venmo, which is owned by Paypal, does not appear to have this problem according to publicly available, consumer reviews.
Here’s an area where Popmoney performs better.
They charge a flat 95 cents per money transfer, unlike Venmo and Paypal, both of which charge a percentage. Zelle, on the other hand, charges nothing, so they win this battle.
Your bank may charge a fee for ACH transfers, so check into that before using Popmoney. Banks and credit unions within the Popmoney network could have better rates or may not charge you extra at all. I searched through Popmoney’s website for more on this, but it’s not there.
That said, 95 cents is not a bad price, particularly since there doesn’t seem to be a limit on how much you can send.
Popmoney Fees vs Other P2P Apps
|Cash App||Free, 1.5% or 3% of the sum*|
|Google Pay Send||Free|
|PayPal||Free or 2.9% + $0.30 fixed**|
|Popmoney||$0.95 per transfer|
|Venmo||3% of sum but can be waived***|
*The Cashapp charges the sender a 3% fee to send a payment using a credit card and 1.5% for an instant deposit to a bank account.
**Sending funds via a PayPal balance or linked bank account is free. Sending funds via a credit card, debit card or PayPal credit will cost you 2.9% of the amount plus a fixed fee of $0.30.
***Venmo waves this fee if transfer is funded via a Venmo balance, a bank account, or a debit card.
Availability – Which Institutions Use It?
There’s a search function on the website where you can look up your bank to see if they do business with Popmoney. Zashpay already connected to 1,400 institutions before they merged with Popmoney so these institutions remain on the list. The major ones include the following:
- Ally Bank
- TD Bank
- Fifth Third Bank
- Regions Bank
- US Bank
- Bank of America
- PNC Bank, NA
- SunTrust Bank
- Wells Fargo Bank
Is it Safe?
Popmoney is legitimate, so there are security safeguards in place.
Popmoney sends a one-time verification code (usually six digits) to the mobile number or email address of the payment sender to thwart unauthorized payments and theft. The user then needs to confirm that code to verify they own that cell number or email address to continue.
Unfortunately, any time you use an email to send or receive money there’s always the possibility of fraud. That email message from a “friend” could be someone looking to steal your money so whenever you receive a request for money be sure to verify the sender’s email or phone number.
Another drawback to Popmoney is there’s no buyer protection if you use it for a purchase. That’s not really what it’s intended for, but there are scenarios where the seller may not want to take credit cards. Be careful in those situations. It could be a scam.
Don’t use Popmoney for online auctions. Whenever you’re buying something “as is” you have very little recourse to begin with. Add in the lack of buyer protection and you’re just asking for your money to be stolen. Use a regular credit card, not a debit card, instead.
What Personal Information is Shared with the Service?
You do have to share your bank tracking and routing numbers with Popmoney, but the recipient of any payments you make has no access to that information. This gives you a level of privacy that writing a check does not.
If you send money to someone who doesn’t have a bank account at a Popmoney affiliated financial institution, they will need to provide their tracking and routing numbers to retrieve the funds. Make that clear to anyone you’re planning on sending a payment to.
Make sure that you’re using the real Popmoney website or mobile app when you enter bank account information. There are a few fraudulent sites out there that disguise themselves as being the legitimate website. Double check the URL at the top of the page to confirm.
PopMoney vs. Competitors
Zelle is the main competitor to Popmoney and lately they’ve been winning the battle. Venmo is considered more of an app for young people making smaller cash transfers, but their subscriber numbers are higher due to affiliations with Paypal and eBay.
Other competitors include Paypal, Google Pay Send, and Facebook Messenger. I’ve compared fees, network size, payment types, speed, and safety features below.
Popmoney vs Zelle
Zelle doesn’t charge a fee to send money. That’s great, but their network (100+ banks) is significantly smaller than Popmoney (over 2500). Like Popmoney, you can send money via email or mobile number, but they also have the option of using your credit card.
Zelle is faster. You don’t have to wait several business days for the transaction to complete. It happens in minutes for in-network users. Recipients outside the network receive their funds within 72 hours. From a security perspective, the two apps are roughly the same.
Popmoney vs Paypal
The fees for Paypal are a little more complex. It’s free to send money using your bank account, but instant transfers are 25 cents. Credit card transfers are 2.9% plus 30 cents per transaction. The upside is that Paypal’s network is the largest in the world.
Regular Paypal money transfers take roughly the same amount of time that Popmoney transfers do. Instant transfers are available within thirty minutes. Security is much better, with buyer and fraud protection available for all accounts.
Popmoney vs Venmo
Venmo is owned by Paypal, but for users it’s a very different experience. It’s easy to set up and you can transfer money with a bank account or debit card for free. Credit card transfers will cost you 3%. Instant transfers are 25 cents and money is available within 30 minutes.
Venmo is only available for users with a US bank account. Regular transfers take one to three business days. They do not offer buyer or seller protection, so if you’re buying merchandise or bidding at an auction, use a credit card or Paypal.
Popmoney vs Google Pay Send
Formerly known as Google Wallet, Google Pay Send charges no fees to send money and you can use it anywhere that Google Pay is accepted. You can link a debit or credit card and instant transfers happen in a matter of minutes. Bank account transfers take three days.
Google Pay Send has the best security on this list. They offer 100% fraud protection for unauthorized transactions, but if you send money voluntarily to someone who’s scamming you it may not be covered, so make sure you know who the recipient is.
Popmoney vs Facebook Messenger
Did you know that you can send and receive money using Facebook Messenger? If you add a credit or debit card to your account, you can conceivably send money to any of the more than one billion people who use Facebook every day. There are no fees to do it.
The drawbacks to Facebook Messenger are speed and network limitations. Payments can take up to five days to show up and Facebook has a policy that you’re only allowed to transfer money between family and friends. If you use it for business, they will shut you down.
Depending on how you use Popmoney and what your expectations are with the application, you may come away satisfied or dissatisfied with your experience. The user interface is fairly lackluster and unimpressive for an app that has had more than a decade to evolve and the time it takes to send and receive funds is quite slow compared to other available options.
That said, the flat fee structure and widespread adoption among major financial institutions allow it to satisfy many customers’ needs.