Chime Vs Cash App: How Do They Differ? (Complete Guide)

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Cash is a cash management company that allows you to send and receive money with friends and family, set up direct deposits, and link to bank accounts.

Chime offers the same features as the Cash app but also allows for additional banking services such as savings and checking accounts along with Chime Global Money Transfers.

The Chime app and the Cash app are very similar in all of their features. This includes the fact that Chime offers an automatic savings tool that automatically moves money into your Chime Savings account when you reach a certain spending limit - thanks to Chime's machine learning technology.

Chime also has Chime global money transfers which allow Chime users to send real-time international transfers in 16 currencies to family and friends.

What factors to consider while choosing an online bank?

  • Fees

Online banks are known for having very little or no fees when it comes to checking/savings accounts.

  • High-interest rate

Online banks tend to have lower interest rates compared to traditional brick-and-mortar banks, but some online banks manage to offer competitive interest rates on savings accounts and CD rates that are close to brick-and-mortar banks' interest rates.

Online banks also offer CD rates, savings account rates, and checking account bonuses which can help you earn extra money on your savings or interest earned on checking accounts.

  • Websites

Online banks have simple websites that are easy to use, but some online banks such as Ally have a superior website that is easy to use and provides 24-hour access to account information.

Online banks make it easy for customers by allowing them to transfer money from the online bank directly to their other accounts or using an ATM machine for free if they are within the network of the online bank's ATMs.

  • Additional Services

Online banks also tend to offer special promotions that can be helpful for some customers. Online banks sometimes offer tools or services that traditional brick-and-mortar banks do not have, which allows them to provide a unique service they wouldn't otherwise provide.

  • Mobile App

Online banks also have mobile apps that allow you to access your money from your phone, but they aren't as reliable as having a dedicated mobile app. Online banks are becoming more reliable when it comes to their mobile apps, but sometimes they still have problems with the reliability of their mobile banking services.

  • Security

FDIC-insured online banks are safe, but make sure to research the online bank before signing up. Online banks also have security features you can use to protect your accounts, such as setting up a password or PIN number that is needed when withdrawing money from an ATM machine.

Online banks are insured by the FDIC just like traditional brick-and-mortar banks are. Online bank security is monitored around the clock by a 24/7 monitoring center that constantly checks for any threats to online bank accounts and will shut down any threats immediately.

What is Cash App?

Cash App is a peer-to-peer mobile payment app that lets users send money to anyone using just a phone number or e-mail address. Cash App is like PayPal, but much easier to use.

Cash app lets you send money via e-mail to anyone, even if they don't have Cash App yet. You can also request money that your friends and family owe you or split dinner with the click of a button. Cash App is free for personal use and business.

Cash App is an online payment processing service that helps small and medium-sized businesses accept credit cards without requiring them to use a traditional merchant account or point-of-sale system. It focuses on providing a complete point of sale or payment platform that can be tailored to specific businesses.

What is Chime Bank?

Chime got started when Chime's CEO and Founder, Chris Britt, was unable to find a checking account that he liked and Chime was created. Chime is different from most banks because Chime attempts to make its services more user-friendly, financial education-focused, and secure rather than just another bank account.

Chime offers a unique approach to banking by attempting to educate its users on how they can manage their money better and save more, which many believe is the biggest problem that financial service companies need to solve.

Chime has been able to increase its user base from 100,000 in 2014 to 1 million Chime users and Chime is adding approximately 10,000 users a month.

Chime has been able to expand into the market because Chime was designed based on customer feedback, 60% of Chime users are under 35 years old and Chime offers low fees for their banking services.

Why should you choose Cash App?

  • Easy to use and sign-up: Cash App is very simple to use. All you need to do is sign up as a Cash user via email or phone number, and Cash will verify your identity by adding a 4-digit PIN if necessary. Once Cash has verified who you are, all you need to do is enter the amount of money that you want to send and Cash uses your phone's GPS system to find Cash users near you.
  • Instant Money transfer: Cash App guarantees that money sent from Cash will arrive in the recipient's Cash app wallet within seconds. Cash does this by sending payments via a secure network of Cash servers instead of through banks and credit cards, which can sometimes mean a transfer delay for larger transfers.
  • No fee for Cash-to-Cash transactions: However, Cash customers can send money from Cash to Cash without being charged a transaction fee. The cash app also provides Cash business users with Cash Invoices that can be paid via Cash-to Cash transfers.
  • Cash App for Android and iOS: The Cash App is available on both Android and iOS devices. The Cash website lists that Cash App is available to download on Android devices running version 4.4 KitKat or higher, which are the majority of Android devices currently in use across the United States. Cash App can be installed on iOS devices running iOS 8 or newer versions of iOS, but Cash does recommend using Cash over WiFi instead of cellular data if transferring Cash balance is a priority for you. Cash App is not currently available on Windows devices, but Cash does plan to release Cash for Windows in the future.

Why should you choose Chime Bank?

  • No Monthly Fees: Chime doesn't charge a monthly fee for Chime's accounts. Chime would rather motivate Chime users to manage their money responsibly with Chime's goal of increasing Chime users' financial knowledge and Chime does this by charging Chime users no monthly fees. In fact, not only does Chime not charge a fee, they actually refund Chime users for any fees Chime users are charged by Chime's partnered banks.
  • FDIC Insured: Chime accounts are FDIC insured, which means Chime account holders would be covered in the event of Chime Bank closing. Chime uses an FDIC pass-through insurance structure so each depositor at Chime is insured to at least $250,000, which includes principal and any accrued interest up to that amount.
  • No Overdraft Fees: Chime doesn't charge Chime users overdraft fees. Chime users can overdraft their accounts because Chime allows Chime users to link their checking accounts with a debit card. Chime's overdraft fee policy is that Chime Chime will not charge Chime user overdraft fees.
  • No Foreign Transaction Fees: Chime doesn't charge any foreign transaction fees, which means every time a Chime user makes a payment in Chime, or whatever currency that is not US Dollars or local to the area where the transaction was made there are no foreign transaction fees.
  • Free Spam Protection: Chime offers free spam protection for text messages, phone calls, and emails to protect its users from fraudulent activity associated with financial service providers such as stealing money from Chime.

Why should you not choose Cash App?

  • Not available internationally: Cash App is only available in the United States and Canada, which means that non-American or Canadian citizens cannot sign up for Cash App. Furthermore, Cash users outside of the United States cannot receive money sent to them in Cash App via credit card for Cash transactions, but Cash is working on expanding Cash service in the future.
  • No advanced features: Cash App has some basic features that you might expect from a Cash-sending application. Cash can send Cash to Cash users or Cash app users who have Cash downloaded directly onto their smartphones, but Cash is currently working on introducing additional features for Cash App in the future, including an expanded app with added charting and technical analysis tools.
  • Lack of customer support: Cash does not provide Cash App customers with a live phone number to contact the Cash app in case of emergencies or needs. Cash's official website provides users with answers to some FAQs, but only Cash mobile applications offer fast answers for questions or concerns about the Cash app.

Why should you not choose Chime Bank?

  • No Personal Touch: The con of Chime bank are the lack of personal touch. Although Chime has a great online banking system, there is no in-person customer service available. For example, if a Chime user wanted to discuss their account with someone at Chime they would have to schedule a call. Chime does have a customer service phone line on the website for questions and answers but it isn't 24/7 available.
  • Limited Services: The services available with Chime are limited. There isn't an ability to schedule future payments on Chime's website either so any scheduled payments have to be done manually.
  • ATM Charges: If using an ATM, however, there will be fees if using an ATM outside of Chime, or whatever currency that is not US Dollars.
  • Spending Limits: Chime users are limited to the amount of money they can spend per month.

Who are the target market of the Chime and Cash app?

Both Chime and the Cash app's target market is anyone who has a bank account and is in need of an alternative banking solution. The target market for both apps includes:

  • People who are sick of traditional brick-and-mortar banks
  • Those looking for a completely free banking solution
  • People who want to manage all of their money from one source

Let us compare both the banks:

  • FDIC Insured:

Chime bank accounts are FDIC insured just like traditional brick-and-mortar banks. You can rest easy knowing that your money is safe, secure, and insured by the FDIC. On the other hand, the Cash app account is not FDIC insured which is slightly riskier for account holders of the Cash app.

  • ATM Network:

If you are looking for an online bank that has low or no monthly fees then either Chime or the Cash app would work for you. However, if you use a lot of ATM machines then Chime would be the better choice because it has more ATMs to choose from.

  • Spending Limit:

If you are someone who likes spending money without worrying about your budget or tracking your expenses then the Cash app would be a good choice for you. The spending limit is only $2,000 with Chime and there is no set spending limit but if you start to abuse this option it could lead to having your account suspended.

  • Standard transfer time:

If you are looking for an online bank with quick transfer times then Chime would be your best option because it takes less than 24 hours to transfer money from one account to another account.

  • Special promotions:

Chime has a special promotion called "Chime plus" which gives you additional features such as a free credit score and unlimited ATM reimbursements. The Cash app doesn't currently have any other special promotions but it does have no ATM fees which is its biggest perk.

  • Mobile app:

One of the cons of the Chime bank is that their mobile app has not been rolled out yet so right now you cannot access your accounts or manage your money from anywhere except through a computer. The Cash app has a good mobile app that allows you to monitor your accounts so if you are looking for an online bank with a strong mobile app then the Cash app would be a better choice.

  • Security:

The security of both Chime and the Cash app is monitored by a 24/7 security monitoring center, which has been known to shut down any threats immediately. The Cash app is slightly more risky for account holders because it is not FDIC insured whereas Chime bank accounts are FDIC insured.

My Recommendation

Chime and the Cash app are two online banks that both offer no monthly account fees. Both apps charge ATM users a small fee for using an ATM outside of the network, but Chime has more ATMs to choose from.

When it comes to fees and security then either app would be a good choice for a traditional brick-and-mortar bank customer, but make sure to research both apps before signing up.

Overall, Chime and the Cash app are two great online banking options that have low or no monthly fees with many free services to offer its customers.

Chime has an upper hand because it is FDIC insured which makes the investment safe and secure. Also, this feature makes it convincing for users to go for Chime bank as they will be tension-free.

Michael Restiano

I support product content strategy for Salt Money. Additionally, I’m helping develop content strategy and processes to deliver quality work for our readers.

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