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More and more people are taking advantage of the convenience of digital payment methods, including peer-to-peer (P2P) payment apps. Venmo is among the most popular of these platforms.
If you’re looking for a mobile payment solution, Venmo may be the app you need. Read on to learn more about the platform, how to set up a Venmo account, and how you can use Venmo instead of other payment options.
Venmo does not pay interest and the company is not FDIC-insured, meaning that if the company ever goes out of business, you could lose all of your money. If you want your funds to accrue interest, they may be better off at an institution that offers a high-yield savings account with FDIC insurance.
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What is the Venmo mobile payment app?
Venmo is a peer-to-peer (P2P) payment app that allows users to easily send and receive money from other Venmo users via their mobile devices. The app can also be used to purchase from a growing list of retailers. Currently, Venmo has more than 60 million users. Other apps similar to Venmo include Cash App, Zelle and PayPal.
Venmo also has a social component — the app includes a timeline transaction feed that shows the two participants in each transaction with a short description by the user. Common transaction descriptions include emojis like food or short phrases like “rent payment” or “concert tickets.” However, participating in the social component is optional. You can set each transaction to public, friends only or private.
Unlike some other digital payment options, Venmo is only available as a mobile app. You can sign into your Venmo account on the computer to view a list of your transactions, but you can only complete transactions using the app.
How does it work?
Venmo acts as a middleman between two people or individuals and businesses. The app collects funds from one user and gives them to the intended recipient by depositing them in their Venmo balance.
So what is Venmo used for? There are two main ways to use Venmo — to transfer money between friends and family and to pay for goods and services, all without any physical cash.
For even more payment options, Venmo partners with Synchrony Bank to act as a credit card company and offer eligible users the Venmo Visa Credit Card. Alternatively, you can get a Venmo Mastercard Debit Card issued by Bancorp Bank, which connects directly to your Venmo balance without any line of credit.
Use it to transfer funds between friends and family
Venmo is best known for being a mobile payment service that facilitates person-to-person payments between friends and family. You can use the app to split restaurant bills with friends, send your portion of the rent to your roommate or send a monetary gift to a family member.
To make a payment to another Venmo user, all you have to do is select the “Pay/Request” button at the bottom of the Venmo app. On the next page, you input the username of the person you want to pay, the amount and a note. Then, you just have to tap “Pay,” and the payment will immediately go to the user you selected.
Venmo also makes it easy to request payments from someone you know. Rather than waiting around and hoping that your friend (or family member, coworker, etc.) will pay you the money they owe, you can request the amount using similar steps. Start by hitting the “Pay/Request” button and entering the person’s username, the amount and your note. Then, tap “Request” instead of “Pay” to request that payment.
The user you requested the payment from will get an alert from Venmo about your request. They then have the opportunity to pay you the amount you asked for quickly. Just be aware that a request is no guarantee of payment.
Use it to pay for goods and services
You can also use Venmo to pay for goods and services from millions of participating vendors. For example, Venmo recently launched a feature that allows users to pay with Venmo on Amazon. Venmo is a payment option on popular sites like Poshmark, Uber Eats, Grubhub and Hulu.
Paying with Venmo isn’t limited to online and mobile purchases, though. Major retailers like CVS and Abercrombie & Fitch now accept Venmo payments at in-person stores. Payments are automatically deducted from your balance, or if your balance doesn’t cover the amount, they’re deducted from your linked bank account. If a retailer doesn’t accept payments through the Venmo app, they likely accept the Venmo Mastercard debit or Visa credit card.
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Who can use Venmo?
To use Venmo, you have to meet the following user requirements:
- You must be over the age of 18.
- You must be physically located in the U.S.
- You must have a bank account, credit card or debit card.
- You must have a unique U.S. cell phone number not linked to another Venmo account.
Anyone who meets these requirements can sign up for a Venmo account. Remember that you also need to keep your Venmo app updated to the latest version to continue using it.
Setting up a Venmo Account
To sign up for Venmo, you have to go through the following steps:
Download the mobile app to your phone
The first step is downloading the Venmo mobile app to your phone. Venmo is available for iOS and Android but does not have a Windows app. Make sure to download your device's current mobile app version.
Create and register an account
Once you have the app on your phone, open it and select whether you want to create a personal or business account. Click “Sign up” and enter your cell phone number on the next screen. After you click “Send code,” Venmo will text a four-digit verification code to your provided number. Enter the code to verify your number.
On the next page, you’ll enter your account details, such as your legal first and last name, desired username, profile picture and email address. Fill out this information to set up your account. At the bottom of the page, you must check a box indicating that you are at least 18 years old and agree to Venmo’s terms. The next page gives you a quick rundown of Venmo’s fees, which you must agree to before proceeding.
Venmo lets you connect to friends on the app by syncing your phone or Facebook contacts. You can skip this step if you’re not interested.
The next thing you must do to create your account is choose your payment settings. Venmo provides three options:
- Public: In the default setting, selecting Public means that anyone on the internet can see your Venmo payments in the public feed.
- Friends: If you choose friends as your payment settings option, only Venmo friends and the other party’s Venmo friends will see your Venmo payments in the social feed.
- Private: Private payment settings mean that each payment you make through the app is only visible to you and the person you paid.
Payment amounts are always private, and you can change your settings anytime.
Connect your bank and debit card
After completing the above steps, you will officially have a new Venmo account. You must still add a payment method like a credit card, debit card or bank account. Select “Add a way to pay” and fill out the details for your chosen payment methods. You can change what card or bank Venmo is connected to later if necessary.
If you’re worried about sharing sensitive banking information, you may wonder — does Venmo have to be linked to a bank account? The answer is no; you can use Venmo without linking your bank account. Instead, link your Venmo account to your credit or debit card or use your Venmo balance to make payments (provided you have already received Venmo payments).
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Venmo FAQs
How many business days does it take to transfer funds?
Standard transfers from your Venmo balance to your bank account typically take one to three business days. When you initiate the transfer, you should be able to see the estimated arrival date of your money in your transaction feeds. Be aware that Venmo reviews bank transfers, and this process can sometimes lead to delays in processing your transfer.
Venmo also offers instant transfers to eligible bank accounts or debit cards. You have to pay Venmo fees of 1.75% (minimum $0.25 and maximum $25) on each instant transfer, but your funds will typically arrive within 30 minutes, even on weekends and bank holidays.
What fees does Venmo charge?
Like other mobile payment services, Venmo charges users various fees depending on how they use the app. Recently, bothVenmo and PayPal fees increasedfor the instant transfer feature, for example.
Other fees in Venmo include: sending money using your credit card (3%), adding money to your Venmo balance using the cash-a-check feature for payroll and government checks ( 1% with a $5 minimum), adding money to your Venmo balance using the cash-a-check feature for all other accepted checks (5% with a $5 minimum), and cryptocurrencies purchases or sales (between $0.49 and 1.8%, depending on the purchase or sale amount)
Many features within Venmo are free, though, so you may never have to pay any fees. For instance, you can pay vendors or contacts using a debit card or Venmo balance without incurring fees. Venmo doesn't charge any account setup or monthly fees, either.
What bank does Venmo connect with?
You can connect your Venmo account to a bank account at any U.S. bank. The bank account must be registered in your name. Otherwise, Venmo will reject it. Keep in mind that you don't need a bank account for Venmo, so if you don't want to connect Venmo to your bank account, that's fine.
Since you can store funds in the app (your Venmo balance), some people also wonder if Venmo is a bank. Venmo itself is not a bank. It simply links to other banks.
Can you use Venmo without a bank account?
You can use Venmo without a bank account. If you want to use Venmo to send money to vendors or people you know without linking your bank account, you can connect a debit or credit card to your account. However, if you don't connect a U.S. bank account to your Venmo profile, you won't be able to transfer money out of your Venmo account to your bank.
Does Venmo pay interest?
Venmo does not pay interest and the company is not FDIC-insured, meaning that if the company ever goes out of business, you could lose all of your money. If you want your funds to accrue interest, they may be better off at an institution that offers a high-yield savings account with FDIC insurance.
What are the maximum transfers per day?
Venmo accounts are subject to weeklytransfer limits. There are no Venmo max transfers per day, however.
If you have not verified your identity in Venmo, you cannot send more than $999.99 to your bank account weekly. If you have verified your identity, that transfer limit increases to $19,999.999 weekly. You cannot transfer more than $5,000 to your bank account at one time, even if you are verified.
Is Venmo safe?
Venmo uses multiple security measures to protect your financial information. The app encrypts all transactions and the personal information you provide, storing it in secure locations. Venmo also automatically monitors your account activity to flag suspicious activity like unusually high payment volume. It will stop any unauthorized transactions as soon as possible. With these factors in mind, Venmo is generally considered a safe app you can trust.
It's still important to take precautions to ensure your financial information is as secure as possible, though. Take advantage of optional security features within the Venmo app, like multi-factor identification and locking your app with a personal identification number (PIN). Be aware of common Venmo scams like fake giveaways that ask you to provide your Venmo account information.
Safely use Venmo to transfer your money
Venmo is a safe, convenient option for sending money to people you know or paying for goods and services. Remember that some transactions in Venmo are subject to fees, so Venmo is not a completely free app. Your account will also be subject to dollar limits that may prevent you from completing all the transactions you want to make. Fees and limits aside, Venmo is one of the best options for sending mobile payments.
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