Is Cash App or PayPal Better? (All You Need to Know)

Mobile payment apps are becoming acceptable across the U.S. as more people use them to send and receive money.

Currently, Cash App and PayPal are the two top payment methods. But which one is better between the two financial platforms? Here’s all you need to know!

Is Cash App or PayPal Better in [currentyear]?

Despite having some similar features, Cash App and PayPal have some different features in terms of payments, fees, customer service, geographical availability, and services in [currentyear]. PayPal gives its customers a more comprehensive experience, making it more popular. On the other hand, Cash App is ideal if you’re looking to invest or make instant payments.

Read on to learn more about how Cash App and PayPal compare, their differences, and which payment method is better overall.

What Is Cash App?

Cash App, previously known as Square Cash, is a mobile payment service that was launched in 2013 by Block Inc., formerly Square Inc.

Once you sign up for this peer-to-peer payment app, you can send, receive money, and invest in Bitcoin and stocks.

Although it works as a bank, Cash App is a financial platform. As of 2021, Cash App had 44 million monthly active users and total revenue of $12.3 billion.

So far, approximately 13 million people have a Cash Card, which they can use to pay for goods and services and withdraw cash at the ATM.

If you have a Cash Card, the Federal Deposit Insurance Corporation (FDIC) ensures the account balance. 

Additionally, the Cash App investment services are also registered with regulatory bodies such as the Security Exchange Commission (SEC).

What Is PayPal?

PayPal is an electronic payment system that was started as a money transfer service by Confinity Inc in 1999.

A year later, Confinity merged with an online banking site, X.com, and changed its name to PayPal. 

PayPal was acquired by eBay Inc for $1.5 billion in 2002 and remained a part of the company until it was spun off in 2015.

Over the years, PayPal has made key acquisitions to fuel growth and expand its customer base.

As of [currentyear], PayPal owns Venmo, Xoom Corp, Zettle, PayPal Credit, Honey Science Corp, Braintree, Happy Returns, Paidy, Simility, Chargehound, and Hyperwallet Systems Inc.

With PayPal, customers can transfer money between accounts electronically. It has over 200 million active accounts globally, and over 7 billion businesses use the platform.

Cash App Vs. PayPal: Which Is Better?

Here’s how Cash App and PayPal compare:

• Fees

Cash App transactions are mostly free. However, there are some services that customers have to pay for.

If you choose instant deposits to transfer cash to your bank, Cash App will charge you between 0.5%-1.75% of the transfer amount and a minimum of $0.25.

Cash App charges between $2 and $2.50 as an ATM withdrawal fee. However, you can avoid incurring this fee if you receive about $300 in qualifying direct deposits.

On the other hand, with PayPal, there are no fees unless there is a currency exchange. They don’t charge a fee to send money domestically from your account or with American Express.

However, if you use a card to make payments, PayPal will charge you a 2.9% fee. Furthermore, international personal transactions are charged a 5% fee.

PayPal also doesn’t charge if you withdraw from a local bank account, but if you make instant withdrawals, you’ll incur a 1.75% fee on the amount transferred.

• Payments

With Cash App, you can make contactless payments for free. As well, you can request or make payments without incurring any app fees.

For instant payments, you just need to enter the recipient’s phone number, email address, or $Cashtag.

Also, PayPal users can send and receive money swiftly without incurring app fees for U.S. transactions.

However, if you pay via debit, credit card, or PayPal Credit, you’ll have to pay some fees.

• Security

Cash App uses fraud detection software and encryption used by Block; to ensure that the customer transactions and data are safe.

On the other hand, PayPal has two-factor authentication for logins. Their security features include detection technology, fraud monitoring, and an email payment confirmation.

Additionally, they encrypt all the data to keep user information secure.

• Availability

Cash App only works in the U.S. and the UK, while PayPal is available in over 200 countries and regions.

In addition, PayPal also supports 25 currencies; therefore, it supports different languages, and users can send money across borders.

If you want to send money outside the US and the UK, you can’t use Cash App, so PayPal has an advantage here.

• Investment

If you have a Cash App account, you can invest in stocks and cryptocurrency. Customers can set up automatic buys, and the transactions start with as little as $1 for fractional purchases.

On the other hand, PayPal account holders can also sell, transfer, or buy some cryptos like Ethereum and Bitcoin.

• Customer Service

To get assistance from the Cash App customer service team, you can contact them in-app, by phone, email, or through social media platforms.

If you need to contact the PayPal team, their contact options include a chatbot, the resolution center, a community help forum, or a phone call.

To know more, you can also read our posts on whether Cash App is instant, whether Cash App is safe to link to your bank account, and how to delete Cash App activity.

Conclusion

Despite having some similar features, Cash App and PayPal have some different features in terms of payments, fees, customer service, geographical availability, and services.

PayPal gives its customers a more comprehensive experience, making it more popular. On the other hand, Cash App is ideal if you’re looking to invest or make instant payments.