U.S. Bank is reacting to a world filled with disruptive money movers (think: Venmo and Facebook) and partnering with Western Union to allow customers to make peer to peer payments from the bank's mobile banking app.

The Minneapolis bank says people can move cash to 500,000 locations in 200 different countries, the same as if they initiated a transaction at a branch. Initially, those customers will be able to move up to $200 a day, and $1,000 a month, though U.S. Bank will inevitably reconsider those limits.

In 2009, U.S. Bank began offering Western Union Money Transfer services in its brick and mortar locations.

"The competitive landscape has changed a lot" in the past decade. "We have participants like Google right now. We have the PayPals of the world, and we know there is some volume of U.S. Bank customers that" are using those services, says Brendan Devine, U.S. Bank's digital money movement manager. "We don't want our customers to use a competitor's tool to get at the digital payments that they are looking to process."

The biggest difference between U.S. Bank's earlier P2P efforts and the Western Union partnership is that the latter is actually creating a cash payout rather than a digital one, explains Devine.

"I think it definitely helps us," he says. "There are a number of P2P products that we offer here and there is a great need for an actual cash payout — a lot of these pilots have digital payouts."

He's referring to the fact that people making payouts to family, friends or roommates have to mostly send money directly to another person's bank account.

The Western Union feature within U.S. Bank's mobile banking app took about a year to develop. The online banking portion of the service took two years to implement.

In September, U.S. Bank began piloting the system internally.

In the future, Devine says, there is room to make the Western Union method quicker (right now the funds are available next day). Evenutally the bank wants to let customers send money from any device to any person or account in real time.