Last week Early Warning Systems announced their new Zelle payment processing system to enable nearly instantaneous transfers of funds for P2P transactions. This move seems to be a response to Apple’s steps to include better P2P features in their iMessage platform on iOS devices. Not to be outdone, PayPal announced today a new feature that will make it possible for users to move money from their PayPal account to their own bank account in mere minutes.
PayPal has already been a big player in the P2P market with products like Venmo and Xoom. The company says more than $7 million dollars move every hour in P2P transactions. A problem for many PayPal users though is that the funds are still tied up in their PayPal accounts. This means they cannot get to it in the form of cash or with a retailer who does not accept PayPal.
The new framework will enable users to move funds from their PayPal account to their linked, eligible debit cards in just a few minutes, although some transfers could take up to 30 minutes. Currently the fastest most users can move money from PayPal into their bank account is one day with some transfers taking longer.
There is a catch though for users interested in this new option. PayPal will charge a transfer fee of 25 cents per transaction. The fee can be avoided by opting for the regular bank transfer method.
PayPal says this new feature is rolling out now as a beta to “select PayPal users” with general availability coming to all U.S. PayPal customers over the next few weeks and months.