69% of smartphone users prefer using an app over a mobile site to transfer money to an individual. And, with so many money transfer apps on the market, consumers ultimately have a lot of choices when it comes time to download a finance app that will help make money transfers safe and easy.
It’s never been easier to send and receive money straight from your phone without having to worry about carrying physical cash. From splitting the dinner bill to paying your friend for your share of the rent, there’s a lot you can do with a transfer app like Zelle, Venmo, or even PayPal.
We’ll be exploring some of the most popular money transfer apps and all of their features and functions. Here it comes Venmo.
What is Venmo?
Chances are that if you’ve only heard of one money transfer app, it’s likely been Venmo. It's a mobile payment service. In fact, the app has become so popular now that it’s even become a verb for sending money to friends. “Just Venmo me the money” is something heard amongst younger social circles nowadays. And, the company has capitalized on the social nature of its app.
The company notes that “At its core, Venmo provides a social way to pay your friends when you owe them money and don't want to deal with cash.” It’s this uniquely social aspect that’s made it so popular for individual use, as opposed to PayPal which is used largely by businesses. You can use it to do things like split a lunch bill, pay for your half of a cab, pay your roommate for rent, or even as a payment method in authorized partner apps.
How Does Venmo Work?
When signing up for a Venmo account you’ll be asked to decide how you want to pay people as well as asked to set up a funding source. It allows you to source money from a credit or debit card, a US bank account, and even by using your Venmo balance. A Venmo balance refers to the money you’ve received from other Venmo users. This means that if you haven’t signed up with your bank information, you can technically still pay others with money in your Venmo balance.
The Venmo login is quite simple and straightforward and the app is very intuitive and easy to use, compared to other payment apps and money transfer platforms, at least. Once you’ve accessed the Venmo sign-in page, all you have to do is choose who you want to send money to, enter the amount, and complete the transfer. If you’re receiving the transfer, you can either leave it in your Venmo balance or transfer it to your bank account. You cannot, however, transfer it to a credit card.
What Banks Use Venmo?
Venmo allows credit, debit and prepaid, network branded (American Express, Discover, MasterCard, Visa, etc.) cards registered under your name to be added to your Venmo account for payments. This means that it should work with any US bank.
It’s important to note, however, that the creation and popularity of it are what initially led banks to develop Zelle. Backed by 30 major banks, the other payment transfer app allows you to easily transfer and receive money directly within your normal banking app. Venmo requires you to download the actual app and isn’t actually backed by banks themselves.
What Are the Fees for Venmo?
Venmo fees? Similar to Zelle and PayPal, there are no fees for using Venmo as a normal payment transfer service. Setting up an account and keeping it active both incur zero fees. And, there are also zero fees for sending people money via your bank account or debit card, or Venmo balance. You will incur a 3% charge if you wish to send money via a credit card, however.
When it comes time to withdraw your money, you’ll notice that an Instant Venmo Transfer comes with a 1% fee. If you can, it’s best to opt for the free option. There is no fee to transfer money from your Venmo account to your bank account with the standard option and the money is typically available in 1-3 business days.
Because PayPal is the parent company of Venmo, you’ll notice similar transfer limits between the two platforms, with both requiring verifications for larger limits. According to the Venmo transfer limits page, your person-to-person sending limit is $299.99 if you haven’t been verified. Once we have confirmed your identity, your weekly transfer limit is $4,999.99.
What Currencies Can You Use with Venmo?
Unfortunately, you can’t send money abroad with Venmo. This is something you’ll notice when setting up your account. The platform’s FAQ section also notes that there are two main requirements for using Venmo:
- You must be physically located in the United States
- You must have a U.S. cell phone that can send or receive text messages. You will need this to complete your sign-up process.
What does this mean in terms of support? Well, because the money transfer app is designed only for use for those residing in the United States, support is also limited. Currently, Venmo customer support appears to only be in English, with some of the online help forums also existing in Spanish.
Is Venmo Safe?
Venmo is safe, yes. The main risk is the same for other payment and money transfer apps in that you’re running the risk of someone hacking your phone and accessing your financial information via the app. Venmo works to reduce such security risks by offering you the ability to add a PIN to your Venmo account. This is a great precaution to take on top of ensuring that your phone is locked with a high-security PIN to prevent anybody from accessing sensitive information.
Also, you should immediately transfer any money you receive to your actual bank account. Avoid leaving lots of cash in your Venmo balance that someone could enter and withdraw or move around.
What About the Venmo Card?
Venmo is one of the few payment transfer apps that has its own special card. The Venmo card is a great option for those interested in earn rewards and cashback. It’s a Mastercard debit card, not a credit card, and it allows you to earn cashback through a new rewards program powered by Dosh. When paying at select retailers, such as Sam’s Club, Sephora, and Target, you can receive up to 5% cashback on your purchase if you pay with a Venmo card.
It works in the same way that a Revolut card might work in that you’ll have to transfer money to the Venmo card via your authorized bank. However, it otherwise works like a regular debit card, allowing you to withdraw cash from ATMs and perform other similar tasks that you might do with a debit card from your regular bank.
It’s worth noting that while there are no fees associated with the card, withdrawing money at a non-MoneyPass ATM will incur a $2.50 ATM Domestic Withdrawal fee. Looking for the Venmo credit card? It’s slated to be released this year!
Another Great Debit Card Option
Transferring money to and from friends and other people is made easy with money transfer apps such as PayPal, Zelle, and Venmo. And while some of these apps are developing their own debit cards with built-in rewards, such as the Venmo card, it’s best to opt for a debit card that’s truly optimized for your savings goas.
While the cashback options are great with the Venmo card, they’re currently only designed for rewards if you spend money at certain retailers. The Cheese Debit Card allows you to earn cashback on all spending, not just with select retailers.
No banking fees, high cashback rates, and even the chance to earn multiple Cheese Rewards? It’s as good as it sounds. Sign up to join our waiting list today.
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