12/29/2022
In the United States there are several apps that allow you to have an e-wallet to manage payments more quickly. This is the case of Venmo, which works only in this country and belongs to PayPal. Below, we will tell you the most important information about its use, how to sign up and get a debit card.
May interest you: How to use cards with digital wallets?
What is Venmo app?
Like other apps such as Zelle, Venmo is a peer-to-peer payment platform that you can install on any of your devices to send or receive money.
It started in 2009 as a text message funds transfer system and then they launched (2012) the program we know today. This company was later acquired by Braintree and ultimately by PayPal.
How Venmo works?
In essence, Venmo lets you send or receive money to your digital wallet where you will carry a balance. It is an app for Android and iOS that also lets you do other operations:
- Use QR codes in stores.
- Shop in the USA with Mastercard debit.
- Receive Bitcoin, Ethereum and other cryptocurrencies alerts.
- Pay through apps and websites associated with Venmo.
- Sign up for direct deposit to have your payroll check delivered to your e-wallet.
- Cash certain checks with the verified account when applying for debit card or direct deposit.
Requirements to use the Venmo app?
Similar to Zelle in its geographic delimitation, Venmo users must meet certain conditions to take advantage of it:
- Be a U.S. resident.
- Be of legal age or over 18 years old.
- Have a U.S. cell phone that can send and receive messages using short codes (this refers to a 5 to 6 digit long sms).
If you want to transfer money from Venmo to your checking account you must have a domestic debit card or a U.S. bank account to do so.
If you do not have access to the virtual wallet balance, you must have a debit/credit card or bank account to make transactions. The same applies if you want to use more money than you have in your digital balance.
How much does it cost you to use Venmo?
In practice, Venmo is not going to charge you any monthly or annual fees. In fact, it's not going to bill you for basic services, such as:
- Making a standard transfer to the linked bank account.
- Sending money from a debit card or bank account affiliated with Venmo.
- Withdrawing funds from your virtual balance or accepting money sent to you by your contacts.
As a PayPal company, it has some defined fees for certain transactions:
- A 3% fee when you use a credit card.
- Various fees for buying or selling cryptocurrencies (ranging from $0.50 to 2.3% of the amount).
- A 1% fee (minimum $5) to use the check cashing feature to make faster deposits of government or payroll checks.
- A 5% fee (minimum $0.25, maximum $15) to instantly transfer money from your Venmo account to your bank account or eligible debit card.
Venmo Money Limits
Due to certain policies associated with money laundering, this app has limits for P2P payments. This involves making purchases online or within the app with your balance, your Mastercard debit card or a QR code at a physical store. Also, keep in mind the following conditions:
- Combined weekly spending limit of $7,000 if you have already verified your identity.
- $5,000 person-to-person payment limit when you have verified your account.
- Combined maximum weekly combined limit of $300 for any one transaction when you have not verified your account.
- Weekly limit of $20,000 on cryptocurrency purchases and a limit of $50,000 within 12 months.
Additionally, this app also restricts the amount of funds you can add or transfer from your Venmo account:
- $3,000 limit for a single transaction.
- When you can add money to your bank account, there is a $1,500 limit from your account to your digital balance.
- Once you confirm your identity, you can transfer $20,000 weekly from Venmo to your bank account.
- If you have not verified your account, there is a $1,000 weekly limit to send balance to your checking account.
- Instant transfers are priced at a regulated rate of $0.26 and up, and standard transfers cost less than $0.25.
How long does it take to make a transaction with Venmo?
The time it takes for money to move from your Venmo balance to your checking account depends on the type of transaction. When it's standard, it can take 1 to 3 days.
Instant transactions, on the other hand, usually take 30 minutes. Transfers that are between users of the platform happen in a few minutes.
How secure is Venmo?
We consider Venmo to be secure because of several elements:
- It uses encryption to protect your data.
- It has multifactor authentication to protect your account.
- When you enter the app, you are sent a verification code (email or sms).
Finally, we remind you that you will need your SSN or ITIN to verify your Venmo account. It is also important to beware of scams on social networks, which have increased in the wake of the Covid19 pandemic.
Español: Qué es Venmo y cómo funciona