Asma Ahmed
Asma Ahmed
Asma is a fintech writer at AskWallet

Cash App — the simplest peer-to-peer money transfer service

The Cash App (also known as Square Cash and developed by Square Inc.) is a mobile payment service to transfer money to others via a mobile phone app. With a simple debit or credit, Cash App lets you quickly send, receive, or request money from other users. You should also know that if you use a credit card to pay, you will be charged an additional 3% fee. The Cash App most useful feature is how quickly funds arrive in your bank account after a transaction is completed. Users can also view their daily profit or loss in the Investments tab, and when they withdraw their bitcoins, they will view the USD equivalent.

6 min read 15.04.2021

What is Cash App?

Cash App works with both consumers and merchants by accepting credit card payments via mobile. With time, Cash App diversified and went beyond consumer operations. Square has made a big bet on consumer loyalty, such as cashless payments, digital punch cards, etc., and now focusing on local and standalone merchants.

 

At first glance, you might think why choose this app over other services. In my view, the Cash App has one unique advantage - you don't need to create an account to use it. However, you must verify your identity to lift the spending limit which is around 250 USD per week.

 

To request cash, select a name from your contact list, or enter an email address or phone number. Choose what the money's for and enter the number. Once the request is received, both parties will be required to verify their banking information and the transfer will be completed.

 

The app lets you receive and send BTC or money to another Cash account via the Cash app or email. It also offers a Visa debit card - Cash Card, which can be used for payments at ATMs or transfer funds to any local bank account. To register a card, users will sign in a mobile app. Then the signature will be printed on the card and sent to the cardholder.

 

The Cash App offers another feature- $Cashtag, Twitter-like name tags, for its users. This feature allows users to transfer and request funds by entering a username. Along with that, the app has a feature to buy Bitcoin for US dollars directly from the Cash App balance. Users can schedule the purchase of cryptocurrency at intervals of once a day, week, or two weeks.

Features

While, I have explained how individuals can use this app, here are some other features of the Cash App:

 

  1. Cash App for Business: Small businesses can also use this app to receive payments form their clients in exchange for a small fee. For businesses, this app is very useful for small-scale merchants who don’t want to pay for a sophisticated Point-of-Sale system. However, it comes with a limit- businesses can only receive payment up to 1000 USD, and to remove this cap they will have to provide detailed personal information. Furthermore, they can’t make or accept overseas payments nor use the app’s Visa debit card or its “Boost” discounts.
  2. Cash App - Investing: Similar to services like Robinhood or WeBull, the Cash App lets its users invest in stock starting from just 1 USD. Though the investment options are currently limited, the users can invest in fractional stocks. You can find more details on the App’s official page.
  3. Cash App - Cryptocurrency: You can buy/sell bitcoins by directly using your Cash App balance; you should have enough funds in your account to do that. You can also transfer your bitcoins to another external e-wallet. Recently, Square has added another feature/benefit of using its Cash Card- to earn bitcoins instantly on every transaction via its  Card’s “Cash Boost.” I recommend contacting their support department to know more about this offer.
  4. Cash Boost: The app’s cash card offers a discount program called “Cash Boost.”all you need to do is to go to any participating restaurant, cafe, or store and use your Cash Card with Boost to get discounts. The app’s official link offers detailed information about how to avail these discounts.

 

Is the Cash App Safe?

Square has PCI DSS Level 1 certification which is the same as used by major credit card companies. iPhone users can also enable TouchID/FaceID, and Android users can turn on biometric authentication as a security lock.

 

The Square Cash App uses encryption for its app and website, but there is no FDIC insurance. The Cash App also uses fraud detection software. The app also offers two-factor authentication for added security.  I would advise to keep your $Cashtags private as there have been incidents where an unknown app user transfers funds into your account and uses nefarious methods to get the money back.

Pros & Cons

  • Easily import contacts from a phonebook and transfer funds via email or phone number.
  • Use Cash App balance directly to purchase or sell Bitcoins.
  • Numerous security features to protect user data- offline storing of Bitcoins, PIN code entry, FaceID, TouchID, and encryption etc.
  • It is a free mobile banking app.
  • No commission on receiving cash.
  • International payments are not possible.
  • Users need to pay a 1.5% fee for instant transfers from app to bank account.

Conclusion

Overall, the Cash App seems good for basic services without paying any fee, and it also comes with a free debit card. However, you need to stay updated with any fee when using your credit card or newly introduced charges. For this, I recommend using the App’s official help section.

 

I also came across a few complaints related to the app’s poor customer support, account closing without prior notice. Some users could not receive their payments as the transaction was declined, and very limited details were provided. Some users also highlighted the sudden account closure when transacting BTCs. 

 

The Cash App is undoubtedly a simple peer-to-peer money transfer app that you can pay attention to. But it is not the only app in the market; for instance it would be more beneficial for personal use and businesses would find PayPal as better with more security. Another close competitor is Venmo which is doing fairly well. If you are looking for an app with no fee, ease of use, and bonuses, I would say that you should give the Cash App a try.

Cash App FAQ

Which banks work with Cash app?

The Cash app currently works with a number of banks and you can link a bank account instead of a Cash App debit card. The app works with the Lincoln Savings Bank, Bank of America, USAA, Sutton Bank, Citi, BB&T, US Bank, Capital One, Chime, PNC, Regions, TS Bank etc. It also depends on the user account, and I would recommend contacting Cash App customer service with your $Cashtag and email address to get an updated list of compatible banks for your account.

How to deposit money to Cash App?

Login to Cash App:

 

  1. Navigate to the Banking tab and click on “Add Cash.”
  2. Enter the amount and tap “Add.”
  3. Confirm via Touch id or PIN.


You may need to add a bank account or card after you register on Cash App. 

How to get card from Cash App?

To request your free card:

 

  1. Tap on “Get Cash Card.”
  2. Click “Continue.”
  3. Complete the next steps.


You will receive the card within ten business days.

How to transfer money from prepaid card to Cash App?

Unfortunately, Cash App does not support all prepaid cards; a government-issued prepaid card can be used to top up your account but not a PayPal prepaid card. 

How to send money with Cash App?

Open Cash App:

 

  1. Enter how much you want to pay, and tap on“Pay.”
  2. Enter the receiver’s details.
  3. Enter the reason for sending money.
  4. Tap “Pay.”

 

The Cash App limit on sending funds is 250 USD within a seven day period. Bank account and debit transactions are fee-free, but a 3% Cash App fee applies on credit cards.  Payments within the network are instant and non cancellable. Also, a Cash App refund payment is quickly added to your account.

Which banks work with Cash app?

The Cash app currently works with a number of banks and you can link a bank account instead of a Cash App debit card. The app works with the Lincoln Savings Bank, Bank of America, USAA, Sutton Bank, Citi, BB&T, US Bank, Capital One, Chime, PNC, Regions, TS Bank etc. It also depends on the user account, and I would recommend contacting Cash App customer service with your $Cashtag and email address to get an updated list of compatible banks for your account.

How to transfer money from prepaid card to Cash App?

Unfortunately, Cash App does not support all prepaid cards; a government-issued prepaid card can be used to top up your account but not a PayPal prepaid card. 

How to deposit money to Cash App?

Login to Cash App:

 

  1. Navigate to the Banking tab and click on “Add Cash.”
  2. Enter the amount and tap “Add.”
  3. Confirm via Touch id or PIN.


You may need to add a bank account or card after you register on Cash App. 

How to send money with Cash App?

Open Cash App:

 

  1. Enter how much you want to pay, and tap on“Pay.”
  2. Enter the receiver’s details.
  3. Enter the reason for sending money.
  4. Tap “Pay.”

 

The Cash App limit on sending funds is 250 USD within a seven day period. Bank account and debit transactions are fee-free, but a 3% Cash App fee applies on credit cards.  Payments within the network are instant and non cancellable. Also, a Cash App refund payment is quickly added to your account.

How to get card from Cash App?

To request your free card:

 

  1. Tap on “Get Cash Card.”
  2. Click “Continue.”
  3. Complete the next steps.


You will receive the card within ten business days.

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Asma Ahmed
Asma Ahmed
As a fintech researcher and writer, she enriches AskWallet website with new posts and articles. Asma is an MBA graduate from IoBM, Karachi and has been working in the financial services industry since 2013. She loves traveling, listening to music, and watching Netflix.