Popmoney vs. PayPal
How Does Popmoney Stack up to PayPal?
Popmoney and PayPal are both decent options for sending money to another person – but which is better? Both allow you to send funds electronically, which means:
- No need to write checks and reorder more when you run out
- No dealing with exact change and breaking large bills
- Easy to prove to forgetful types that you really did pay
However, Popmoney and PayPal serve different needs. We’ll do a full comparison below, but as an overview:
- Popmoney works best as a person-to-person (P2P) payment service with people you know and trust
- PayPal can handle P2P payments, and it’s also useful for shopping
Fees at Popmoney vs PayPal
Fees are generally modest using either Popmoney or PayPal, and they’re probably worth the benefits when you consider postage, the cost of checks, and the value of your time. Just make sure you know what the fees are and that it really makes sense – if you make frequent, small payments, that’s different from the occasional, large payment.
- PayPal is generally free for personal payments as long as you draw from your bank account (as opposed to funding with a debit or credit card)
- PayPal should be free for payments you make to a business (when you shop online or at a brick-and-mortar merchant)
- PayPal costs money when you’re getting paid as a business
- Popmoney is generally free when receiving money
- Your bank may charge a small fee for sending money via Popmoney ($1 or so per payment)
- Sending money from your account at Popmoney.com costs $0.95
- Requesting money from somebody at Popmoney.com costs $0.95 (again, it’s free for you if the person initiates the transaction without you requesting money)
Of course, there could always be additional fees for certain situations. For example, PayPal charges extra to businesses if a chargeback occurs. If you’re concerned about fees, read the fee disclosures for each service carefully.
Just about anybody with a bank account can use PayPal or Popmoney – which is one more reason to open a real bank account if you don’t yet have one.
For a while, sending money with Popmoney was only available to customers at certain banks. Now, anybody can sign up and create a profile at Popmoney.com (using a payment account at any bank). Checking, money market, and direct deposit accounts will all work with Popmoney, whether sending or receiving money; savings accounts do not work – regulations make savings accounts unsuitable for any kind of payment service. You can also send money from a debit card account.
Popmoney advantage: if your bank works with Popmoney, life is a little easier – you don’t have to set up a profile or provide bank information at Popmoney.com. Instead, just log in through online banking and use Popmoney from there.
PayPal advantage: not everybody uses a bank or credit union that uses Popmoney, but it is very common to have a PayPal account.
Others might not want to set up a new account at Popmoney.
If you plan to shop online (or even with certain brick-and-mortar stores such as Home Depot), PayPal is the better option. Retailers and online merchants often offer PayPal as a payment method.
In some cases, it’s wise to pay with PayPal. When buying from a website that you don’t know anything about, it’s scary – and risky – to provide your credit or debit card number. With PayPal, you keep those numbers safe (the vendor only sees your username or email address).
Which is Safer?
Both Popmoney and PayPal use state-of-the-art security to keep your money (and your personal information) safe. That said, data breaches happen, so it’s worth keeping track of your accounts and reporting suspicious activity as soon as possible.
When buying from a merchant – or a stranger on the internet – PayPal has “buyer protection” for certain transactions, which can be helpful if there’s a dispute with the seller.
Popmoney does not offer buyer protection, and thieves have used the service to take advantage of people who send funds (and get nothing). Don’t send money with Popmoney unless you really know where the money is going and you trust the person (the same goes for Venmo).
Popmoney will only pull funds from your bank “transaction” account (checking, savings, and money market accounts) – but you can link your debit card, which pulls funds from checking.
PayPal will link to your bank account, as well as credit cards and debit cards. You can also spend from your PayPal balance (if you keep money in PayPal), and there are several ways to add to your PayPal balance.