Whether you're loaning friends some money or simply looking to pay back a buddy who picked up the tab at the bar last night, Venmo has quickly become one of the most popular ways to instantly send people money.
But Venmo is far from perfect. And if you don't watch your back, you might become another victim defrauded by scammers who are using the service for illicit purposes. Here's everything you need to know about this popular money-transferring service.
What is Venmo, anyway?
Venmo is a peer-to-peer digital-payment service that allows you to send money to friends and family. You can also use the service to send money to companies. And because there's a social feed baked into Venmo, you can keep track of what your friends are doing with their funds.
How does Venmo work?
You can sign up for Venmo with your email address or by connecting your Facebook account. You'll also want to download the Venmo app to your iOS or Android phone, so you can easily access it and transfer money.
Next up, find friends and family and connect with them on Venmo. Once you're connected, you'll want to either collect money into your Venmo account from others or make and share payments by connecting a bank account or debit card to the service.
Once your account is set up, you can simply choose the person to whom you want to send money, input the amount you're sending and the reason, and they'll immediately get receipt of payment. The payment's reason that you type into the payment area will also be shared in your social feed for others to see, unless you decide to keep it private.
If you're on the receiving end of the Venmo payment, you can also connect your bank account and transfer that money into your account.
How can I fund my Venmo account?
Venmo offers a variety of solutions for funding your account.
The simplest, of course, is to get Venmo payments from a friend or family member. As long as you don't remove it from your account, that money will sit there, waiting for you to use it on something else.
If you want to link a bank account or card, you need to go to the Settings section of the app and choose Banks & Cards. There, you'll see an option to set up your payment services.
Venmo allows you to use a variety of accounts for your service. Simply input your bank account information, including the account and routing numbers, and you'll be good to go. In some cases, Venmo might ask you to provide your online banking username and password.
In order to verify your ownership, Venmo will send a micro-transfer to your account to ensure it's really yours. Once you're set up, you can use the account to fund your transfers.
If you'd prefer to use a debit or credit card, the process is similarly simple. You'll tap the three bars at the top of the app to access your Settings pane. Next, choose Banks & Cards and then "Add debit or credit card." Be aware that Venmo works with prepaid cards, as well.
How do I request money on Venmo?
When someone owes you some money, you can create a new payment using the pencil and paper at the top of the screen. Then, you can choose from Pay or Request. Choose the latter.
Venmo will ask you how much you think you're owed and a reason for the payment. The app will then ask you to send the request to the recipient. That person will get a notification that will then allow them to pay you.
Do I need to pay Venmo? How does Venmo make money?
When you send money via your Venmo balance, bank account, debit card or prepaid card, Venmo waives all fees, so you don't incur a charge. And when you receive money from the service or make purchases in other apps, you can use Venmo without ever incurring a charge.
Venmo does, however, charge a 3 percent fee on any amount you send to someone else using a credit card. The company also charges you 25 cents if you choose an instant transfer of your Venmo balance to your bank account instead of the standard service.
How long does it take for my Venmo payments to show up in my bank account?
Unfortunately, that's a bit of a moving target.
Once you get a Venmo payment and decide to transfer that money to your bank account, the company will give you an estimated arrival date. If you transfer the funds before 7 p.m. ET on a business day, it'll probably show up in your account the next business day. So, if you transfer your money to your account on a Saturday, you might be waiting a few days to get it.
Can I use Venmo to buy goods and services?
Yes, you can. But there are some things to keep in mind.
For one, you can use Venmo to pay only with merchants that accept the payment method. According to Venmo, companies that support the service will have a "Venmo-branded payment button at checkout."
Additionally, because PayPal owns Venmo, you may have the option of using Venmo as your payment method in some places that accept PayPal.
Are there payment limits?
To start, Venmo limits your total payments and purchases each week to $299.99. If the service has verified your identity, however, that can jump to $4,999.99 per week.
To confirm your identity, you'll need to provide Venmo with the last four digits of your Social Security number, your zip code and your birth date.
Be aware, however, that you're limited to $2,999.99 per week in fund transfers that take the form of payments or accepted requests. Authorized merchant payments are up to $2,000 per transaction, and Venmo Visa debit-card transactions are similarly limited to $2,000 per transaction.
One other limit: Venmo will not allow you to conduct more than 30 authorized merchant payments per day. There's no limit to the amount you can receive via Venmo.
Do I need to share my activity with others?
A core component in the Venmo experience is the sharing of payments in a social feed with friends and family. Venmo pitches it as a way to relive a great night out with friends or to tell the world that you're sending a cool gift to a friend on their birthday.
But there are also privacy implications to all of that. And that's why Venmo gives you full control over what is and is not shared with your community of friends and family.
For one, you can set a default privacy setting that will decide how much of your payment information is saved, like the amount, whom you sent it to and the reason for sending it. Venmo also gives you the option of creating specific settings for each payment. So, you could share your payment for a night out with friends but not your payment for your half of the rent.
Because there are two people in each transaction, Venmo will apply the most restrictive policy to the payment. So, if you don't mind sharing everything about the payment, but your friend wants to keep it private, your friend's setting will prevail.
Be aware, however, that every payment and the details on it will be displayed by default in your personal news feed that only you can see.
How does Venmo keep my information safe?
Venmo has a handy security page that details how the service works to keep your information safe.
For one, the company says that it uses encryption to protect your account details and store information on secure servers. And when you use Venmo in the browser, the service uses SSL security.
If you lose your phone with all of your Venmo information on it, you can lock it and stop anyone who might have picked it up from accessing your information. Venmo also includes support for multifactor authentication and a PIN code for getting into the app.
I've heard some complaints about Venmo's security. What's that all about?
Scamming on Venmo has become an increasingly concerning problem that you'll definitely want to keep an eye out for.
While Venmo users have been targeted in a variety of ways, the most common method is via Craigslist and other similar marketplaces where products are bought and sold.
The scam usually goes something like this: You offer to sell something on Craigslist or another service, and someone comes along to buy the product. The person might ask to pay you in two amounts. The first might be half of the amount, or even less, with a promise to pay the balance in the second payment. The first payment will come through without a problem, and you'll transfer the funds to your bank account. The second payment will follow a day later. You'll then believe the full payment is made, and you'll send off your stuff to the recipient.
Soon after, however, you'll discover either that the person canceled the second payment or that it was frozen because it violated Venmo's terms of service. The scammer will then walk off with whatever you sold for a fraction of the full value.
The problem appears to be in the way Venmo itself works.
Venmo is designed for payments to be made between friends and family for things like rent and picking up a tab. It's not, however, an option for buying and selling products between two people trying to engage in a transaction.
In fact, Venmo's user agreement and Help pages clearly state that you can use the service only with people you know and trust. The only way to use Venmo to pay for goods and services is with merchants.
Venmo has a warning page on its website that describes the scam outlined above. It says in no uncertain terms that "concert tickets, electronic equipment, sneakers, a watch or other merchandise" are especially troublesome transactions. Worst of all, the company won't protect you if you're scammed.
"If you send a Venmo payment to someone for a good or service, you could lose your money without ever getting what you paid for," the company's warning reads. "If you accept a Venmo payment from someone for a good or service, and we later review the payment, we may reverse the payment, meaning you could lose both the payment and the item sold."
Does Venmo work on both iOS and Android?
You betcha. Venmo's iOS app is available on iPhones, iPads and iPod Touch devices running iOS 10.0 or later. If you're on an Android device, you need it to run Android 4.1 or later to get Venmo up and running.
Can I use Venmo with Siri?
You can! From your iOS device, you need only activate Siri and ask the service to send cash to a friend. Siri will then display a summary of the proposed transaction. And if it all checks out, you can authorize the payment, and Siri will take it from there.
Can I use Venmo with iMessage?
When you download Venmo to your iPhone, you'll see an icon in iMessage that allows you to transfer money via Venmo.
Once you're ready to make the transfer, simply choose the Venmo icon and decide whether you want to request or pay funds. Type the amount and the note for your transaction, and you'll be good to go. When you send the payment to a friend, they'll be able to accept it on their end.