PayPal launched in 2014 the Venmo App. It is an app that let you use your phone to exchange money with your friends. Not big lump sums, just a few bucks at a time.
It was created by two college room-mates back in 2012 who sold it after 5 months to Braintree for 26M$. Braintree was acquired by PayPal (eBay) in 2013 for 800M$, mostly because of Venmo.
You can transfer money on the app tapping your bank account and from there you can give some money to a friend to pay for a pizza. Indeed, according to Nielsen, 49% of use happens during a dinner.
It is an alternative money circuit that skips the ones owned by banks.
Peanuts, you would think. Well, in 2014, the year it was launched, Venmo processed transaction for 2.4 billion $, and in the second quarter of 2015 it has processed 1.6 billion $ (that is over 6 billion $ estimated in 2015). Clearly compared to the amount of money flowing on the banks circuits it is peanuts, but over 5 billion $ makes for a lot of peanuts! And the growth is impressive. A doubling in just 12 months.
In the US the expression: "Venmo me later" is becoming the equivalent of "Pay me later" and when a brand becomes a verb (like "Google for it) it tells a lot about its acceptance.
Venmo is not alone. Googe wallet (allowing up to 10,000$ transfer per day) and Square Cash (with a transfer limit of 250$ that can grow after a period of use to 2,500$ per day) are other means.
And US is not the leading Country in terms of P2P payments. In Kenya 92% of the population uses their cell phones to transfer money.
Expect the off bank money exchange to grow further in the coming years. It is a disruption in the making.... Millennials (18-24 yo) make for 55% of the P2P payment market, and as they grow older and pass the habit to the newer generations the P2P payments will just grow. According to BI Intelligence, P2P payments are expected to reach 86B$ by 2018 in the US.