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a new platform enabling MasterCard customers to send funds that can be received within seconds by any debit card or bank account. MasterCard Send enables funds
to be sent quickly and securely to consumers domestically and internationally from other consumers or from gov- ernments, businesses and nonprofits. In the U.S. Master- Card Send is provided to consumers via P2P providers (issuers, money transfer operators, merchants, others), remittance providers, businesses, governments and other “senders” that send funds to consumers. It enables cross- border payments originating in the U.S. and in more than 200 countries.
Microsoft laying P2P Groundwork?
Microsoft captured P2P watchers’ attention with news that the tech giant has applied for money transmitter licenses in all 48 U.S. states that require them and has registered with FinCEN as a money services business. Microsoft’s new Windows 10 also has features that could support a biomet- rics-based approach to authenticating users for payments.
PayPal P2P Pioneer.
Founded in 1998 with P2P as a core service, PayPal claims 169 million active mobile wallets in 26 currencies across 190 nations. It’s free to send funds in the U.S. using a bank account or PayPal balance; via debit or credit card is 2.9 percent plus $0.30/transaction within U.S. Outside the U.S., it costs between 0.5 to 2 percent using a bank account or PayPal balance; 3.4 to 3.9 percent using debit or credit card.
Square Cash Free for Debit Card Users.
Square Inc. in 2013 expanded beyond its core m-POS
services to begin supporting free P2P payments for Visa and MasterCard debit card customers via email and within the Square Cash app. Funds transfers can take one to two days to settle. Square says it processes $1 billion annually in P2P transfers. Square enables businesses to accept consumer payments via Square Cash, charging a 1.5 percent processing fee for each transaction.
Venmo Popular with Millennials.
Founded in 2009, Venmo in 2012 was acquired by Braintree for $26.2 million (PayPal then absorbed Braintree in 2013). The company has about 60 employ- ees and provides P2P service via an app. Venmo is free when sending funds within the U.S. from bank accounts or debit cards; the fee for sending funds from a credit card is 3 percent. The startup handled $2.4 billion
in P2P transfers last year and processed $1.6 billion in transaction volume during the quarter ended June 30, 2015, a 247 percent increase over the same period
a year earlier.
Visa Connecting Customers.
Visa Direct enables consumers to transfer funds
from one Visa account to another by taking advantage of Visa Inc.’s existing network of more than 14,500 financial institutions in more than 200 countries and territories, tens of millions of merchants and 2.1 billion Visa accounts in markets around the world. Visa Direct is offered to consumers in 25 countries in partnership with more than 100 financial institutions. Consumers can initiate a Visa Direct transaction through many channels, including bank branch, ATM, online, kiosk
or mobile phone.
volume 8 • fall 2015
generation that has never written a check, Venmo is the way to pay the rent, pay back a friend and it is in the middle of how the millennial gen- eration manages and moves its money,” PayPal CEO Dan Schulman told analysts in July 2015.
Millennial Momentum
Millennials could be the force that helps P2P break into real growth because of patterns emerging with their use of mobile payments, according to Marianne Berry, a managing director at Auriemma
Consulting. “Millennials are lead- ing growth of mobile payments, according to our consumer re- search, and it makes sense that they’ll look to their phones as the way to pay their peers,” she tells Paybefore. Millennials already are
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