Money Transfers

An article out of Denmark late last year was nearly incomprehensible – the Nordic country is debating the idea of eliminating physical currency (bills and coins) from circulation. The news caught most of the world off-guard, many brushed it off as fake news or a prank while some seriously pondered life without physical money. But ponder long enough and you’d realize that nowadays you can get by without ever having to exchange physical cash or coins for services. At least most of the time.

Much of this is thanks to technological advancements in how we transfer money. Following is a list of the most common and popular methods per category.

P2P Apps and Services

P2P refers to person-to-person, sending money from you to your sister for example. Paypal has been a leader in this arena, the oldest and still widely popular way to transfer money easily and directly. Linked to a bank account, you can log in and transfer the money from your Paypal account to someone else’s. If you do not have enough funds in your Paypal account, Paypal enters your bank account and accesses them.

Venmo is owned by Paypal and like Paypal works in a nearly identical fashion. More popular with millennials, with Venmo one can include messages with the transfer which younger folks seem to enjoy. Square Cash has been building a loyal following, enabling clients to send money from debit cards. There is no charge with Square Cash, but the transfers can take a couple days to clear. Google Pay is unsurprisingly linked to a Gmail account and one may send money to not only Gmail addresses, but any address, free of charge.

Bank Services

Older than new-age P2P services, banks work in conjunction with each other to allow money transfer between client accounts. Popmoney however is a new intermediary that makes these transfers more seamless and less costly. Wire transfers, which most folks are aware of, moves money in a more formal fashion. Still used today for very large sums, the downside of wire transfers is most will charge a flat rate – anywhere from $30 to $40 per transfer. However, if you’re transferring $8,000, that’s a relatively minor charge.

Money Transfer Services

Remittances are money transfers that immigrants to a country typically send back to their families in their country of origin. For example, a man from Honduras who is now working in Michigan can send via a money transfer service money on a monthly basis back to his father in Honduras through MoneyGram or Western Union. These are popular options as they are international in nature and generally secure. The person receiving the money generally picks it up in person.

Overseas Transfers

While MoneyGram and Western Union are the popular options, Xoom and Travelex are gaining ground. The latter offer more flexible timetables/services and render the transaction less physical (picking up cash in person) and more virtual. This ties in well with Denmark’s proposal of a world without currency which drive people to navigate online options.

Now, tipping the guy who helps park your car might not be faster via a transfer from your account to his on your smartphone, but without a physical $1 in your pocket that’s where we’re moving. At least in Denmark.

Riffbuddy users have quite a bit of experience with money transfer options. See what they have to say about some of the well-known and lesser known options: Riffbuddy - Money Transfers.