Cashless and contactless interactions saw a dramatic upswing in the last few years thanks to the COVID-19 pandemic. Digital transactions are so commonplace now that you rarely, if ever, need to dig through your pockets for germ-saturated bills and credit cards. We handle our smartphones all day, so it only makes sense to use them to make payments. And there's no shortage of mobile payment apps for Android and iOS that let you do exactly that.

Some mobile payment apps, such as Cash App and PayPal, are standalone downloads; others are baked into other services. For example, Apple Pay's in-store payments are built into the Wallet app, and person-to-person payments happen inside the Messages app. Likewise, Zelle is often integrated into your bank's app.

Ready to put mobile payment apps to work? First read about their various features to help find a service that best suits your needs. Then lend a buddy cash, buy yourself lunch, or go hard with online purchases.

(Credit: Google)

How to Send Money With Mobile Payment Apps

Probably the most buzzworthy mobile payment option is peer-to-peer payments, as exemplified by Venmo. There are plenty of other choices for paying your friends directly, however. Apple Pay Cash, Google Pay, PayPal, Cash App, and Zelle all let you settle up with other people. With Apple Pay, you can only pay contacts who have iPhones, though, whereas Venmo and the rest are cross-platform services.

When you receive money, most apps store your money in a holding place, a sort of limited bank account. Zelle and Google Pay are the exceptions here, delivering funds directly to the recipient's bank account. Several of the apps, like Venmo, require a fee to dump money from your app account into your bank account (see next section).

Do Mobile Payment Apps Charge Fees?

Most person-to-person payments are free with these apps, unless you use a credit card rather than a bank account or debit card. A fee of about 3 percent comes from the credit card provider when you use that as your payment source. Some cards offer cash-back points (and you may even get bonus points for using mobile payments), so you'll want to do the math to see which payment method benefits you most.

Some services charge yet another fee when you want to transfer received money to your bank account. Cash App charges 0.5% to 1.75% fee for instant deposits (with a minimum fee of $0.25), and Venmo charges a 1.5% fee (with a $0.25 minimum fee) per expedited deposit. Zelle is the best deal here: Because it's connected to the banks, sent money goes straight into your bank account, rather than into the payment service account. Google Pay doesn't charge to dump money into your bank account. International transfers pay even higher fees. For details on that, see the International Support section below.

Are There Money Limits to Mobile Payment Apps?

The services vary in how much they let you pay, but they generally increase your maximum allowed payment with increased usage. Venmo starts you out with a $300-per-week cap, for example, but this limit can climb to a whopping $60,000 per week after you verify your identity. Zelle's limits are determined by your bank. The Ally online bank, for example, lets you send up to $5,000 per day and $10,000 per month via Zelle. Google Pay lets you send up to $5,000 per week after you verify your identity. If you don't, Google Pay limits you to $500 per week.

(Credit: Samsung)

How to Make In-Store Mobile Payments

A few of the apps included here let you pay stores as well as your friends. Google Pay, Apple Pay, and Samsung Pay are strong contenders in this area. Apple has outpaced all other comers in in-store contactless payments. Samsung Pay is distinguished in that it works wherever a magnetic stripe card does, though those have largely been replaced by the more secure NFC point-of-sale devices.

PayPal can be used to pay in a few stores, though it lacks direct NFC wireless payments. Cash App is a bit of a hybrid in this category: You can use the app to pay for items in brick-and-mortar stores, but also request a debit card that taps your Cash App balance.

How to Make International Mobile Payments

Only a few of the highlighted apps and services support payments to people abroad. The separate category of international remittance apps includes Xoom, a PayPal service, which lets users send payments to people in 131 countries without the recipient needing the app or even a smartphone: They can simply pick up the cash in their local currency at a nearby bank with a code and an ID.

As mentioned above, you incur greater fees for this cross-border convenience. When you send money to Guatemala, for example, Xoom charges $2.99 if you use a bank account and $3.99 for a credit card, along with whatever exchange-rate fee it may impose. This varies greatly by country: For payments to Finland, you pay nothing when using a bank account, but when using a credit card, you pay about 3 percent of the transaction amount.

PayPal also lets you send money directly to other PayPal recipients in more than 200 countries worldwide, without the need for banks, or cash pick-up. For in-store payments, Samsung Pay works in 17 countries beyond the US, and Google Pay works in the UK, as well as in the US. Apple Pay works in 26 countries' stores, but person-to-person payments only work with US accounts.

How to Make Mobile Payments on the Web and With a Watch

Many of the services let you pay via a web browser rather than solely through an app. PayPal is famous for this, and Venmo, Xoom, Google Pay, and others offer web interfaces as well. Apple Pay is weak in this area since it only works in Safari on a Mac that's in proximity of your iPhone.

Samsung Pay can only make web payments if you link a Visa Checkout account, but it works on the company's phones and (very well) on its smartwatches. Apple Pay works on the Apple Watch, as you might expect, and there are a few Google Wear OS watches that support Google Pay.

Are Mobile Payment Apps Secure?

The apps and services that support in-store payments all use anonymized tokens, or encrypted versions of your credit card number. The actual number isn't transferred, so it's actually safer than handing over your plastic. All of the services, because they transmit credit card information, must comply with the PCI Data Security Standard (PCI DSS)—the same standard used with analog payment cards. That includes things like implementing newer transport security than SSL and early TLS.

Further, most banks have a zero-liability policy for credit card fraud, meaning if you've been cheated, you don't have to pay anything (with certain reasonable limitations). By law, the maximum you could be responsible for is $50. Most of the services also use fraud detection technology to protect you, as well.

But person-to-person payments not involving credit cards are a whole different story: There's no protection for Venmo or Zelle money transfers to speak of. Once you pay someone in the app, you should consider it the equivalent of handing over cash, and equally easy or hard to get back. That's one reason why you should never use p2p services to pay businesses or buy things on the internet with them: You could end up losing your money and not getting the product you thought you bought.

(Credit: Apple)

Another thing to be on the lookout for with these services is getting payments or requests for money from those you don't know. Well-known scams involve someone sending you a bunch of money through the app and asking you for repayment. A common scam is that the source of the payment to you comes from a stolen credit card. If you accept that money, you could find yourself in deep legal doo-doo.

What Else Can You Do With Mobile Payment Apps?

The services included here often do more than just let you pay. There are various extra perks that some offer such as those listed below.

Splitting payments. Say your group of pals went to a fancy restaurant for a birthday celebration. How do you all pay your fair share? Many payment apps and services let you split a payment—simply enter the full amount and all the contacts that need to chip in. Of course, they need to be signed up with the payment service you're using.

Order ahead. LevelUp and others hook into local eateries and let you put in an order so that your lunch is ready for you to pick up when you arrive. It's similar to what's offered by some merchant-specific apps like the Starbucks app.

Loyalty cards. Many of the apps and services here let you enter loyalty program information to let you keep accruing those reward points. LevelUp, PayPal, Samsung Pay, and Google Pay are strong in this area.

Gift cards. Several of these apps offer a convenient way to combine all your cash or store gift cards. Usually you just have to snap a picture of the card and maybe enter a code to make the money available from the payment app.

Bitcoin and Investing. Only Cash App among the apps included here lets you purchase and sell Bitcoin, but you're probably using Coinbase or another cryptocurrency wallet if you're a Bitcoin fan. Cash App also makes it easy to buy fractional stocks: For example, you want some Berkshire Hathaway (BRK-A), but don't have the $317,000 price of a single share. Pick up $100 worth in your Cash App.

Credit cards and ATM cards. The highest-profile example of this is the Apple Card, which offers 2 percent rewards (3 percent for Apple products) and some other nifty options. PayPal and Venmo both offer credit and debit cards, and Cash App's debit card occasionally offers some very deep discounts. Samsung offers a card and a no-fee, interest-bearing money management account provided by SoFi.

Feel free to chime in on PCMag's social channels (Facebook, Twitter) to share your experiences and tips for navigating the brave new world of mobile payments. Let us know if there's one missing from our roundup that you love, or one included that gave you fits. In the meantime, keep that plastic and green paper in your wallet!

For more on mobile payments, check out How to Avoid Mobile Payment App Scams.