How to Build a P2P Payment App in 2022: Moving Toward a Cashless Future

11 min readApr 15, 2022


Technology continuously changes the world and our lives. Just 20 years ago, could anyone have imagined it would be so easy to have a video call with a friend in another country? Or to order food from restaurants? Or to send and receive money while sitting on the couch? It’s so popular that, according to IFAD, one in seven people send or receive money using P2P apps. Fun fact: June 16th is the International Day of Family Remittances (IDFR).

In this blog post, we’ll cover the process of developing a P2P payment app from scratch. Read on to find out how to create an online payment app and learn about the different types and the advantages through our step-by-step guide.

What is a P2P payment app?

P2P stands for “peer-to-peer.” With a P2P app, a person can send money directly to another person’s wallet or bank account. Basically, the process is like this: you open the app, choose your recipient, type in the amount of money you want to send, and send it. There are no geographical or physical boundaries, and you can do it at any time anywhere there’s an Internet connection. What else can you do with these apps?

  • Pay for services (like a taxi or the Internet)
  • Donate to organizations
  • Support your loved ones
  • Send and receive friend-to-friend borrowing requests
  • Send money to family members in other countries

It sounds so easy and so many people are already using these apps. However, the process of creating an online payment app is much more complicated than using one. These services started in 2009, when Venmo was created, and we’re sure you’ve heard of PayPal as well.

Types of P2P payment apps

Let’s take a look at the different types of P2P apps to help you make an informed decision about your future product.

  • Standalone services: These apps have an all-in-one structure for fund transfers.

Examples: PayPal (426 million active users in 2022), Venmo (52 million active users in 2020), Airfox Square Cash, Cash app.

  • Bank-centric apps: These apps use banks as an intermediary for funding transfers. With these apps, users complete transactions using their credit/debit cards.

Examples: Zelle app.

  • Social media-centric apps: These apps allow users to send money using their social media accounts. Just imagine how convenient it could be when you’re chatting with a friend if you could send them money without even leaving the chat itself. In addition, this type of app doesn’t require any additional authentication to complete the transaction.

Examples: WhatsApp (by Meta; launched this feature in 2020), WeChat, SquareCash.

  • Mobile OS-centric services: These apps enable users to send money to other users within an operating system. Users can also pay at stores where Point of Sale (PoS) equipment features NFC (near-field communication) technology.

Examples: Apple Pay, Android Pay, Samsung Pay.

Advantages of payment P2P app development

What are the reasons for the growth of P2P apps? They have many advantages over traditional payment methods. Here are some of the reasons users love them.

  • Speed: No waiting in line.
  • Transparency: For currency exchange, users can often find a reasonable rate which is determined by overall demand, not by any government organizations or banks.
  • Security: Developers must be compliant with a strict policy that ensures personal financial information is securely stored and never leaked.
  • Ease of use: After downloading an app, all the features are just a few steps away.

As a developer, future CEO, or product owner, what is appealing about P2P apps?

  • Organic growth

People tend to recommend the products and services they use to their family and friends. When they are excited about something, they tell others about it and then other people are willing to try it too. This word-of-mouth works better than any other form of advertising, according to 64 percent of marketers.

  • Retention

The success of this kind of product requires more than just a smooth UX and bug-free code. These things are just the base. The next step is to build a loyal community around the product, but once this base is built, users will continue to come back and are less likely to switch to a competitor.

  • The rise of digital remittances

The next section covers some interesting statistics in this area.

Payment applications market overview

Think with Google reports that 69% of smartphone users prefer using an app over a mobile site for money transfers to an individual. The main reason for this is the convenience of P2P payment apps, which enable you to send money with just a few taps.

The increasing number of mobile devices has changed the way we shop. According to the E-Commerce Foundation, more than 25 percent of consumers use their mobile devices for purchases at least once a week, with most of these purchases being made from a retailer’s app or website.

Due to the improved convenience of mobile payment, these transactions have grown 26.63% from 2020 to 2025, and are expected to eventually overtake cash and credit card transactions in every region.

Take a look at the following data and statistics to get a sense of the remittance industry.

  1. It is growing faster than FinTech companies. P2P mobile payment transaction volume reached $785.19 billion in 2021. When Revolut was launched in 2015, it was just another P2P platform and PayPal already existed, but it currently has over a million monthly active users and is available in more than 10 EU countries.
  2. It has a predicted CAGR of 5.7% from 2021 to 2030.

You can enter new markets with the same product and strategies by simply carrying out localization of the product and adapting the marketing strategy. A great example is the Paystack acquisition by Stripe.

Let’s look at the world’s most popular P2P payment apps

Zelle is considered the best P2P app for instant bank transfers as money is transferred directly into the user’s bank account within minutes, and Zelle is compatible with a broad range of banks and credit unions (but unfortunately usable only within the USA).

Source: Zelle

Venmo (which is owned by PayPal) allows users to link their bank account or credit card to their Venmo account, and then request, send, and receive money from other Venmo users.

PayPal is perhaps the most popular online payment service for online merchants and buyers, but other registered users can also use many functions. All you need to send money to someone is their username, email, or phone number.

Source: PayPal

Google Pay allows users to make purchases and money transfers with a digital wallet (available in the USA only).

Apple Pay Cash allows Apple users to send and receive money in the Messages app, which is compatible with more recent versions of iPhone, iPad, Apple Watch, and Mac devices.

Source: Apple Pay Cash

Tech stack, requirements, and team

Who are the people that can turn your idea into reality?

  • UI/UX designers are responsible for making the user experience simple and enjoyable.
  • Business analysts conduct market research.
  • Front-end engineers write the code for the platform you’ve chosen.
  • Back-end engineers are responsible for server-side web application logic and integration of the work front-end engineers do.
  • QA specialists search for bugs.
  • Project managers organize the work of the other team members and make sure everything goes according to plan.

Here is a list of recommended technologies for creating a native app.

  • For iOS: Swift/Objective-C, Apple XCode/Intellij AppCode
  • For Android: Java, Android Studio/Eclipse
  • Admin panel: JavaScript, Laravel Nova
  • Payment gateway: Stripe, PayPal, Braintree, Mastercard, and other options
  • Geolocation: Google Maps API
  • Utilities: Firebase, Twilio, Facebook SDK, and Google SDK
  • Notifications: Chrome notifications, Rest APIs, Amazon SNS, APNS, and Firebase cloud messaging.
  • Unique ID and OTP verification: Bamboo invoice, Rest APIs
  • Digital wallet: Rest APIs
  • Sending bills and invoices: 3rd party SDKs like Firebase, Twilio, Nexmo, Digimiles
  • Sending and receiving money: Dwolla, ACH
  • Biometric authentication: Optical fingerprint, Capacitive sensors

How to create an online payment app: main steps

Now that we’ve covered the types of P2P apps, the feature list, and the tech requirements, let’s talk about the development stages. All of them are equally important and shouldn’t be overlooked.

1. Market and User Research

This step is fundamental for the success of your P2P app, yet many entrepreneurs fail because they didn’t conduct simple competitor research. According to Investopedia, lack of research is the third biggest reason why startups fail.

Make sure to include regional market and target audience research, as well as the analysis of what your competitors have done and what worked well for them. The results of this research should answer important questions like the following.

  • Who is your target consumer?
  • What are their pains?
  • How can your app solve them?

2. Software Specifications

When you know what your users want, start creating the list of features that your users are looking for.

3. Design

In this stage, you’ll put the insights derived from stage 1 to use. We all know a smooth UX is important because it affects how users interact with your product, so, we won’t talk about that too much here.

Also, make sure to include UX writers from the very beginning of the design and development process. If they are involved in various textual aspects of the app such as messages for buttons, pop-ups, menus, and onboarding, they can make sure all the text in your interface is clear and well-written.

4. Development

Finally, we start development! This is the stage when the magic begins and your team of professionals starts creating the P2P app you envision. The list of features you choose will influence the final cost and duration of development.

You’re free to add additional features but here is a list of must-have ones you should definitely include:

  • User authorization

It goes without saying that a P2P app must comply with regulations and be secure. This feature helps keep each transaction secure and prevents third-party interference. Some authorization options include FaceID, biometric integration, and PIN management.

  • Unique ID/OTP (“one-time password”)

This feature increases the security for each transaction by requiring the user to enter a unique PIN (sent to their device via SMS, email, or push notification) to complete the transaction.

  • Bill payments and money transfers

Quite obvious, right?

  • Account linking

Allowing users to link bank accounts and credit/debit cards can make transactions even more streamlined.

  • Invoice building

This feature simplifies the lives of freelancers and business owners, so it’s found in many P2P apps.

  • Bill scanning

This feature is used to scan a bill which can then be sent to a recipient.

  • Transaction history and payment statistics

Financial literacy starts with understanding where your money goes. This feature helps users better manage their spending and lifestyle.

  • Notifications

Notifications help users stay updated about everything that happens with their accounts so they don’t miss important information.

  • Mobile chat

This enables users to discuss details right in the app.

  • Customer Support

Your support department can be assisted by chatbots who collect the primary information from users along with human operators who are ready to help with complex requests or in later stages.

Once you’ve decided on the list of features, set a timeline and try to stick with it.

5. Testing

We recommend that you start testing your app as soon as possible so you can fix bugs quickly.

6. Security issues and compliance with regulations

The financial market is regulated but it depends on the region. Here are some examples of organizations that supervise legal regulations you must comply within certain regions.

  • The UK — Financial Conduct Authority
  • US — Depends on the state
  • European Union — Directive (EU) 2015/2366 + GDPR compliance
  • Australia — Innovation Hub by the Australian Securities and Investments Commission (ASIC)

7. Launch

Finally, after all that hard work, your app is ready to launch. In this stage, you’ll get feedback from real users which you can use to upgrade your app and add new features. That’s why we recommend setting aside some additional funds in your budget for feature extension, enhancement, maintenance, analytics, and monitoring.

P2P payment app development cost

The development cost varies widely depending on your team’s location. Let’s take a closer look with a simple calculation based on the estimated time spent on each stage.

  • Research — 150 (North America — $1,500; Western Europe — $800; Asia — $600; Latin America — $750)
  • Development — 350 (North America — $35,000; Western Europe — $17,500; Asia — $12,250; Latin America — $7,000)
  • Testing & Launch — 120 (North America — $3,600; Western Europe — $1,800; Asia — $1,200; Latin America — $1,600)
  • Support — 300 (North America — $6,000; Western Europe — $3,000; Asia — $2,300; Latin America — $2,600)

Based on the figures above, developing and launching a P2P payment app will cost anywhere from $12,000 to $120,000 depending on where your team is located.

Monetization strategies for P2P payment apps

Simply writing code and designing an app is not sufficient for a successful project. Choosing the monetization strategy for your P2P payment app is also a crucial step.

  • Transaction fees: You take a percentage from every transfer made in your system. Users don’t like this model very much.
  • Ads: You place an ad holder in your UI and charge advertisers for each show or click.
  • Freemium: The core functionality is available to all users but some premium features are only in the paid plans. This model is especially good because it can also incorporate elements of the other two above.

Pitfalls and challenges

Now that you know about the advantages of P2P Payment app development, let’s talk about some of the challenges you may face.

Safety and Security

Every P2P app must comply with the Payment Card Industry ( PCI) guidelines to ensure proper safety and security. These require your app to achieve the following.

  • Securely store personal information
  • Have strong access control standards
  • Continuously update its security policies
  • Regularly test and monitor networks

Compliance with regulations

Regulation for these types of apps includes regional or country-specific limitations, jurisdiction-related challenges, and mindset-oriented issues.

Currency conversion

International payments can be challenging due to the 180+ active currencies that may require conversions.

Dispute management

Money is a sensitive topic for most people, and they are not really willing to share personal and financial information even with P2P payment apps.

The bottom line

The remittance industry is booming and is expected to continue to grow in the future. With a well-chosen feature list, tech stack, design strategy, and professional team, you can create the next P2P payment app that will make a splash in the FinTech industry.

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