Choosing an Option for Sending Money Electronically
Writing a check, addressing an envelope, attaching a stamp, putting in the mailbox… unless you’re die-hard old school, you may find the process a bit tedious.
You’re likely aware you can send money electronically. But if you’ve never done so, you might fear the unknown. How safe is it? What are the advantages? What are your options? What are the costs? How do you do it?
While the old school process may be tedious, at least it’s not confusing, right? But rest assured, in this case, technology can be your friend.
We’re here to flatten out your learning curve. In this primer, we’ll walk you through the essentials of sending money electronically.
Financial transactions on the internet? It’s understandable if online security worries have you a little apprehensive.
But with advances in technology, sending money online is safer than it’s ever been. According to NerdWallet: “All of the major person-to-person systems are encrypted, meaning that your financial information is shielded.”
While the threat of hacks is not zero, all of these systems boast of fraud monitoring and support teams to help customers resolve any unauthorized transactions. Some of these systems automatically send transaction notifications. But you need to verify with the system you choose. If these are alerts are not sent automatically, going into your settings and opting to receive alerts will give you another valuable layer of security.
Most banks offer a similar person-to-person payment options, but offer an additional layer of security. If your money is misdirected, you can have the issue resolved by federal law.
So it’s safe, but what are the benefits?
Say you’re out to dinner with a friend and realize you’ve forgotten your wallet. You could just smile sheepishly and promise to pay your friend back soon.
Or you could pay your friend back before the waitress returns with the change. These person-to-person payment systems offer apps, so you can send cash from your phone with a few keystrokes.
Unless you’re big proponent of the postal system, you’d probably appreciate saving the cost of stamps and envelopes. It may not sounds like a ton of savings, but after a while, it really adds up.
Raise your hand if you actually enjoy manually entering transactions in your check register. Anyone? Anyone? Yep, well neither do we.
When you send a payment online, all of the systems automatically track each of your transactions, making them easy to find. (Though the parent in us still believes recording in your check register is a wise backup!)
Help the Environment
Fewer checks. Fewer envelopes. More smiles from Mother Nature.
OK, the benefits make sense…so what are the options?
Honestly, there are too many to list them all. But here are a few of the major players highlighted by NerdWallet:
- The granddaddy of online payment
- Fee of 2.9% + 30 cents per transaction by credit card
- Max payment of $10,000 per day
- 1 day to access funds
- Newer player owned by PayPal
- Fee of 3% per transaction by credit card
- Max payment of $2,999 per week
- 1-2 days to access funds
- If it’s tech, this internet giant will be involved
- No fees
- Max payment of $9,999 per day
- Must connect debit card to account
- Payment in minutes to connected debit card
- A nuts-and-bolts system
- Fee of 3% per transaction by credit card
- Max payment of $2,500 per day
- 1 day to access funds, although you can access instantly for a surcharge of 1%
In response to the success of these platforms, many banks offer the same services through their online account management. As a bonus, banks tend not to charge transaction fees. Also, as mentioned previously, there’s an extra layer of protection from the federal government.
A common misconception is that only the huge national banks offer modern technological amenities. However, this is definitely not the case. Quite often, your local community bank can provide the same features. They also tend to offer service with a more ‘human touch’ when needed, so you could be getting the best of both worlds.
So I have options, but how hard is it to actually send payments?
Actually, not too hard. All of these systems offer detailed instructions and many provide online
Let’s use The Bank of Southside Virginia as an example of how the process works. Local to
Central Virginia, BSV was the first bank to offer online banking in the area, even pre-dating
national competitors. While no two systems are exactly the same, this example will provide a
solid overview of the general process.
- Login to the BSV Mobile App and click ‘Pay’.
- Select an individual to pay, or add a new one by pressing +.
- To set up a new payee, you just need their name, phone, and email. You will establish a
- Your payee will receive an email to accept the transfer from you.
Now you can securely deposit payments electronically from your account the the payee’s account. How easy was that?
Hopefully with a little light shed on the unknown, you’ll be reassured enough to give it a chance. You’ll likely save money, time, and hassle. Hard to beat that trifecta.