Language:
By Ashwani Shoda
Published on 28 May 2024 7 min read
Venmo is a mobile payment platform from PayPal that has taken the digital world by storm. Launched in 2009, it quickly gained popularity as a convenient way to split bills, pay for purchases, or send money to friends and family.
However, Venmo is expected to become even more popular and widespread as technology advances and people rely more on platforms for digital cashless transactions.
So, we’ve created a comprehensive guide that will take you through everything you need to know about using Venmo. From setting up your account to mastering advanced features, it’ll help you get the most out of Venmo.
Let’s jump in to learn about this convenient and user-friendly platform for peer-to-peer transactions!
What Is Venmo?
Venmo has become one of the most popular mobile payment apps in recent years, and for good reason. With its user-friendly interface and convenient features, it’s no surprise that many people use Venmo as their preferred payment method.
With Venmo, you can easily send money to anyone with just a few taps on your phone. Whether splitting rent with roommates or paying back a friend for dinner, Venmo makes it quick and easy to transfer funds without any hassle.
The most attractive feature is that there are no transaction fees for standard bank transfers, making it a cost-effective option for sending money.
You can also connect your preferred payment method and seamlessly transfer funds whenever needed. This means you don’t have to constantly load money onto your account like other payment apps require.
Furthermore, Venmo allows you to split bills with multiple people in real-time, see and interact with your friends’ transactions, and track who owes you money.
How Does It Work?
You can pay on Venmo by sending money to someone’s username (@username) or scanning their unique QR code using the phone’s camera feature. You can also request money from others by simply entering their username or selecting them from your contacts list.
Another useful feature of Venmo is its split bill option, which comes in handy when dining out with friends or splitting expenses on trips. Users can easily split bills with others in real time without worrying about collecting cash or dealing with awkward IOUs (I owe you).
It’s worth noting that while Venmo offers many convenient features, it does charge transaction fees when using a credit card as a payment source.
However, there are no transaction fees when using a bank account or debit card.
Setting up Your Venmo Account: A Step-by-Step Guide
Setting up a Venmo account is simple and takes only a few minutes. Following these step-by-step instructions lets you quickly get started with this convenient payment platform and enjoy hassle-free money transfers.
Step 1: Download the Venmo App
The first step in using Venmo is downloading the app on your smartphone. It is available for iOS and Android devices and can be found in the App Store or Google Play Store.
Step 2: Create an Account
Once you have downloaded the app, open it and click “Sign Up.” You will then be prompted to enter your email address, phone number, password, full name, date of birth, and zip code. Make sure to use accurate information, as this will be used for security purposes.
Step 3: Verify Your Email Address
After completing all the required fields, you will receive an email from Venmo with a verification link. Click on this link to verify your email address.
Step 4: Link Your Bank Account or Card
You must link a bank account or debit/credit card to send money through Venmo. Go to “Settings” > “Payment Methods” > “Add Bank or Card.” Follow the prompts to enter your banking information or scan your card using your phone’s camera.
Step 5: Set Up Security Measures
Setting up security measures, such as enabling two-factor authentication via SMS code or fingerprint recognition, is important to protect your account from unauthorized access.
Step 6: Finish Your Profile
You can personalize your Venmo profile by adding a profile picture, username, and bio. This will make it easier for your friends to find you on the app. Congratulations! You are now ready to start sending and receiving money easily using Venmo.
Keep in mind that Venmo may require additional verification steps for security purposes, such as linking a social media account or confirming personal information. To avoid any issues in the future, it is important always to use accurate information when creating your account.
How to Use Venmo?
Venmo offers convenient and easy-to-use features that simplify splitting payments, requesting money, and making domestic wire transfers hassle-free. Its user-friendly interface and convenient features make it popular for these tasks.
🔵 For Splitting Payments
Splitting expenses among friends or family members becomes quick and effortless with Venmo. To split a payment on Venmo, you need to:
1. Open the app and tap the menu icon (three horizontal lines) at the top left corner.
2. Select ‘Pay or Request’ from the menu options.
3. Enter the email address, phone number, or username of the person with whom you want to split the payment.
4. Add a note describing the reason for splitting and enter the amount to be paid.
5. Tap ‘Split Payment’ at the bottom of your screen.
6. Choose your preferred payment method (bank account or debit/credit card).
7. Confirm by tapping on ‘Request Money.’
Once your friend(s) receive(s) this request, they can pay their share directly into your account through Venmo.
🔵 For Requesting Money
With Venmo’s requesting money feature, you can easily ask someone to pay back any owed amount with a button tap.
1. Open your Venmo app and tap ‘Requests’ at the bottom center of your screen.
2. Enter an email address, phone number, or username of who owes you money.
3. Add details such as what they owe you and how much they need to pay back.
4. Tap on ‘Request’ to send a request notification to that individual’s account.
5. Click on the option to add a reminder note or set a due date for the payment.
🔵 For Sending Money Internationally
Venmo has expanded its services to allow users to send payments internationally, making it easier for people with friends and family abroad. However, this feature is available only for users with a US bank account or debit/credit card.
1. Open the app and tap ‘Pay or Request’ at the bottom.
2. Enter the recipient’s email address, phone number, or username.
3. Add a note describing the purpose of your payment.
4. Enter the amount you wish to transfer in USD (US dollars).
5. Select your preferred payment method and tap on ‘Next.’
6. Review your transaction details and confirm by tapping on ‘Pay.’
7. The recipient will receive an email notification and instructions on claiming their funds.
Who Can Use Venmo?
Venmo is ideal for anyone who wants a convenient and hassle-free way to send and receive money. With its easy-to-use interface and fast transaction times, Venmo appeals to many individuals, from college students to small business owners to families and travelers.
So you won’t have to worry about carrying cash or dealing with multiple bank transfers.
In fact, many businesses now accept Venmo as a form of payment. Whether splitting the bill at a restaurant, paying your rent, or sending money to a friend, Venmo is the ultimate solution for all your payment needs.
Freelancers and small business owners can also avoid lengthy processing times and high transaction fees for checks or wire transfers. Venmo is also a great banking solution for digital nomads working remotely or abroad to send money back home.
Pros & Cons of Venmo
While Venmo offers many benefits regarding convenience and speed, it’s important to consider its potential drawbacks. You can decide whether Venmo is the right digital payment platform by weighing these pros and cons.
Let’s take a closer look at the advantages and disadvantages of using Venmo.
Pros of Using Venmo
1. Easy to Use
One of Venmo’s biggest advantages is its user-friendly interface. The app is designed to be easy for even non-tech-savvy individuals to use. You can quickly send or request money from your contacts with just a few taps.
2. Fast Transactions
Another great benefit of Venmo is its speed. Unlike traditional methods of sending money, such as bank transfers, which can take several days to reflect in the recipient’s account, Venmo transactions are almost instant.
3. Splitting Expenses Made Easy
Whether you’re sharing rent with roommates or splitting dinner bills with friends, Venmo makes it incredibly convenient to split expenses among multiple people with just a few clicks.
4. No Need for Cash
With Venmo, there’s no need to carry cash around or worry about exact change when paying someone back. This is especially helpful during times when physical contact should be avoided due to safety concerns.
5. Security Measures
Venmo uses encryption technology and multi-factor authentication methods such as PIN codes and fingerprint recognition to ensure secure transactions.
Cons of Using Venmo
1. Fees for Instant Transfers
While standard transfers on Venmo are free, if you want an instant transfer into your bank account or debit card, there’s a 1% transaction fee (with a minimum fee of $0.25).
2. Limited International Use
Unlike other digital payment platforms like PayPal, Venmo is limited to only use within the United States. This means that you cannot send or receive money from international contacts.
3. Dependence on Smartphone
To use Venmo, you need a smartphone and a stable internet connection. This may inconvenience some users who prefer to access their accounts through a desktop computer.
How Businesses Are Utilizing Venmo in 2024
In2021, Venmo for Business was launched to let small businesses create business profiles and accept Venmo as a digital payment method.
So, if you want to offer Venmo as a payment option, you can set up a Venmo account, create a business profile, and enter your business information. The business profile signup process is quick and easy.
You’ll need to provide your employer identification number (EIN), business name, address, username, and a short description of your business and business category. Venmo will ask you to send additional documentation for personal and business verification.
1. Payment Processing
Instead of relying on traditional methods like credit cards or checks, many companies have turned to Venmo for a faster and more efficient way to get paid.
With just a few clicks, customers can easily transfer funds from their bank account or credit card to the business’ account. This saves time and reduces the risk of fraud or errors associated with traditional payment methods.
2. Business-to-Business Transactions
Many small businesses, startups, and freelancers now use Venmo to pay for goods and services from other businesses instead of writing checks or sending wire transfers.
This eliminates cumbersome paperwork and allows for instant payments between parties.
3. Employee Payroll
Venmo has also entered employee payroll systems for many companies. Rather than issuing physical paychecks or direct deposits, employers can transfer funds directly to their employees’ Venmo accounts on payday.
This saves time and gives employees greater control over managing their finances.
Get Started With doola
doola’s business-in-a-box solution helps entrepreneurs and business owners form and manage a legal entity without hassle. We cover all administrative requirements such as business formation, business bank accounts, bookkeeping, and tax compliance.
We handle all the complex documentation and mundane financial tasks, such as tax filings, so you can focus on what you do best: doing business.
Book a free consultation with a doola expert and set up your LLC in 5 minutes!
