THE PEER-TO-PEER PAYMENTS EXPLAINER: Why tech companies and banks are offering a service that doesn't make money

A lot of money gets passed around informally every day — when we pay someone back for dinner, pay a babysitter, or pay a roommate for rent.

Now a bunch of different tech companies and banks are offering apps that can make this process easier and all but eliminate the need for cash and checks. The problem: there’s no money to be made from facilitating these transactions.

So why are so many businesses clamoring to get into this space?

The answer is different depending on the company — for banks it’s critical to keep up with consumers’ account needs while for social messaging apps it’s a broader play for the e-commerce market.

In a new report from BI Intelligence, we explore the market for P2P payments, how they work, and the types of businesses that are offering these services and why.

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Here are some of the key takeaways from the report:

In full, the report:

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