What Is Cash App and How Does It Work?

Has a friend asked you to send the money you owe them via Cash App? Perhaps you’ve encountered a small business that accepts Cash App and you’re wondering, “How does Cash App work?”

See: How To Guard Your Wealth From a Potential Banking Crisis With Gold

Keep reading to find out more about Cash App, how to use it, and the fees and limitations you may encounter if you sign up for this popular mobile platform.

What Is Cash App?

Cash App is a popular U.S. digital banking and mobile payment app, boasting over 50 million active users. While the app is not a bank account, it offers banking services and debit cards through its FDIC-insured bank partners. Cash App users can also buy stocks and bitcoin and file their taxes for free with Cash App Taxes.

How Does Cash App Work?

Cash App works much like a paperless checking account. A Cash App account comes with a unique account number and routing number, just as you would have with a traditional checking account, and allows you to do far more than transfer and receive money with other Cash App users.

With a Cash App account, you can also:

• Set up direct deposits
• Sign up for the Cash App Cash Card, a Visa debit card, to make purchases or get cash from an ATM
• Buy stocks and bitcoin
• File taxes for free with Cash App Taxes

To use Cash App, you must download the mobile app and follow the prompts to create an account. Your account will be tied to your username, or what Cash App refers to as a $Cashtag.

How Do You Send Money With Cash App?

To send a payment to another Cash App user:

1. Launch Cash App.
2. Enter the amount to pay on the Cash App home screen.
3. Select “Pay” and search for the payee’s $Cashtag, phone number or email address.
4. Tap “Pay.”

How Does Cash App Work When Receiving Money?

To receive money from another Cash App user, you can submit a request as follows:

1. Launch Cash App.
2. Enter the requested amount on the Cash App home screen.
3. Select “Request” and search for the $Cashtag, phone number or email address of the user.
4. Tap “Request.”

Once the other user has sent the money, your Cash App balance will reflect the transfer, and you’ll see the transaction in your activity feed. If you linked a bank account to your Cash App account, you can transfer the funds to your linked account.

How Does Cash App Work Without a Bank Account?

You do not have to have a bank account for Cash App. The easiest way to use Cash App without a bank account is to sign up for a Cash App Cash Card. You can use the Cash Card to make purchases with your Cash App balance or get cash from an ATM. You can also add cash to your Cash App account at select retailers.

How Do You Add Money to Your Cash App Account?

You have a few options for getting money into your Cash App account.

If you have linked your bank account to your Cash App account, you can take the following steps to initiate a transfer from your bank account to your Cash App account:

1. Open Cash App.
2. Select the bank icon.
3. Tap the “Add Cash” button from the banking tab.
4. Enter a cash amount.
5. Tap the “Add” button.
6. Enter your PIN or use Touch ID if you have Cash App security enabled.

If you don’t have a linked bank account, you can deposit cash to your Cash App account at several retailers, including Walmart, Dollar General and Walgreens. The store clerk will need to scan your Cash App bar code to initiate the deposit, and you may be asked to swipe your Cash App Cash Card and show your ID.

How Much Does It Cost To Use Cash App?

You can use most of Cash App’s features for free. However, there are a few fees you may encounter.

When cashing out from your Cash App account to your linked bank account, if you opt for an instant transfer, you’ll pay a fee of 0.5% to 1.75% of the transfer amount with a minimum of 25 cents. However, if you use the standard transfer of one to three business days rather than the instant transfer, the transfer is free.

For example, you might be wondering: What is the Cash App fee for cashing out $100? A standard deposit of $100 is free. For an instant transfer of $100 from Cash App to your linked bank account, you’ll pay somewhere between 50 cents and $1.75. 

You may also pay a $2.50 ATM fee to use your Cash App Cash Card if you don’t meet direct deposit requirements.

Additionally, there is typically a fee if you’re dealing with bitcoin, but you’ll be able to see the fee before you make any transaction.

Are There Dollar Limits on Cash App?

You should be aware of the following dollar limits when using Cash App:

Transaction Type	Limits
Sending and receiving money	Send up to $250 per seven-day period Receive up to $1,000 per 30-day period Verified accounts may have higher limits
Paper money deposits	$500 in a single deposit $1,000 per rolling seven days $4,000 per rolling 30 days
Cash Card purchases	$7,000 per transaction $7,000 per day $10,000 per week $15,000 per month
ATM withdrawal	$1,000 daily $1,000 per transaction $1,000 weekly

Final Take

Cash App enables you to perform several financial tasks, including sending and receiving money, making purchases and investing. That said, like any financial product, it has some limitations and may be more beneficial as a companion to your regular bank account rather than a replacement.

With Cash App or any other mobile payment app, make sure you’re extra careful if you’re sending cash. If you send it to the wrong person, you might not get the money back. Also, stay up to date on the latest Cash App scams and never send money to or receive money from someone you do not know and trust.

Barri Segal contributed to the reporting for this article.

Information is accurate as of May 11, 2023.

Editorial Note: This content is not provided by any entity covered in this article. Any opinions, analyses, reviews, ratings or recommendations expressed in this article are those of the author alone and have not been reviewed, approved or otherwise endorsed by any entity named in this article.