Getting together with friends for a big event or a group purchase can be a great way to manage costs and do something as a community. Even with the best intentions, though, managing all of that money can become a bit of a pain. That’s when you need to turn to a handy personal finance platform that can help you get repaid without any hassle.
Best for pooling your resources: PayPal
PayPal is particularly helpful for those times when you want to create a collective pot of money – for instance, if you are gathering contributions towards a friend’s birthday present.
It works by setting up what’s known as a Money Pool. These are fully encrypted totally fee free (unless you need to convert currency), and can be shared in a click through WhatsApp as well as email or other messaging apps. Your friends don’t need a PayPal account to contribute as Money Pools will accept payment by debit card or bank transfer. For bigger purchases such as a group holiday, this is also one of the only options that allows people to easily send you money using a credit card.
Best for being paid back: Monzo
If you’ve already paid for something and now want somebody else to contribute towards the cost, then you’ll benefit greatly from having a Monzo account. Their ‘split the bill’ function means it’s possible to request money from others to contribute towards a specific payment from your account.
It’s really simple to use. Just tap on the payment and then select ‘split the bill’. It works best if the other contributors also have a Monzo account, as you’ll be able to find them in the app and then send them a direct notification requesting a transfer. You can also request payment from people who don’t have a Monzo account – this is done by generating a link to be shared through email or private message.
Best for sending a large amount of money: Direct bank transfer
In cases where just one person needs to pay a relatively large sum to another, your best option is probably through a more old-fashioned bank transfer. Although you could consider using a more advanced app to settle the debt, the most secure and convenient route is to make a BACS payment. This is where money is transferred directly from one account to another.
You can make this kind of payment through your banking app. The sender will need to input the recipient’s account number, sort code, full name and potentially other details such as the name of the bank. It’s completely safe to share these details with somebody that you trust, as they can’t be used to take funds from your account without authorisation.
Depending on how much money you’re looking to send, you may need to split the transaction over several days. This is because some banks put a limit on how much money you can send as a way of limiting fraud.