What Businesses Need to Know About Venmo

Should your business accept Venmo? Here’s what you Businesses know about this payment method.

• Venmo may be used by small companies in addition to peer-to-peer transactions.
• If you currently take PayPal, accepting Venmo payments won’t cost you anything extra.
• Venmo has a number of advantages for companies, including quick processing and transaction security.
• For company owners who are interested in taking Venmo payments, read this post.

With Venmo, it’s simple to split a check with a buddy or even reimburse your roommate for the rent you shared. But Venmo is more than simply a peer-to-peer payment software; it also plays a significant role in the B2C sector. In reality, practically all mobile websites that accept PayPal now accept payments through Venmo, which is owned by PayPal Holdings Inc.

If your small business is searching for a PayPal replacement, it’s important to consider what Venmo may do for your firm. Everything you need to know about Venmo, including its functionality and commonly asked questions, is outlined here.

What Venmo is and how it works

Customers may attach a credit or debit card to Venmo, a mobile banking app, and send money to friends, family, and companies. If a person hasn’t altered their privacy settings, a completed payment automatically displays on both their feed and the feed of everyone else. Users may like and comment on friends’ payments and simply track their own payments, exactly like they would with mobile banking applications.

Venmo has a variety of advantages for companies, but its quick payments and social presence stand out. However, there is a cost for merchants: 1.9% + 10 cents each transaction, much like with credit card processing and other online payment processors. [Learn more about small company credit card processing.]

Venmo’s best business features

There is a solid reason why small company owners are hopping on the Venmo bandwagon. We conducted interviews with a few company owners and personally examined Venmo’s business features. Here are the top features Venmo has to offer businesses, according to our analysis.

Online integration

Venmo is a fantastic tool for e-commerce platforms to interface with effortlessly, which helps online shops increase revenue. It offers a convenient payment option that younger clients are already accustomed to.

Raeka Morar, the owner of Raeka Beauty, stated, “We chose [to utilize] Venmo… after a few clients requested and informed us they were more comfortable using Venmo than using their card to swipe. Venmo is simple, enjoyable, and secure. Customers feel safe and secure not having to provide online retailers their credit card or debit card information.

Venmo is also perfect for small-scale retail transactions where a pricey POS system is not required. Venmo is a crucial tool for in-store transactions, according to Tyler Browne, the owner of To the Cloud Vapor Store, even if it only represents approximately 1% of his business’s revenue.

Although we are primarily an online retailer, many of our local clients come into our office thanks to SEO, the guy explained. “We merely utilize Venmo rather than turn people away or build an expensive POS for a limited number of transactions a month.” How to Understand and Use POS Systems is a related guide.

Speed

The ease with which users may transfer money to their banks is the main attraction for both consumers and companies. Instant transfers are available through Venmo’s business version, enabling businesses to receive funds and make payments the same day.

Many of Pavement’s customers use Venmo because it is quick, simple, and well-known, according to Sarah Zurell, a former executive vice president of the peer-to-peer parking business.

According to Zurell, “Venmo has enabled Pavement to provide our hosts—those renting parking spaces—a compensation alternative that many of them currently utilize. “Paying hosts through their bank accounts is slower than using Venmo.”

Venmo users who need to pay freelancers can also benefit from its quickness. According to Zack Bates, CEO of Private Club Marketing, the majority of these freelancers are millennials who want to be paid as soon as possible, so he switched from PayPal to Venmo. Private Club Marketing has an established network of independent photographers and videographers across the country who work together on projects to promote private members’ clubs. [Use our marketing advice for millennials.]

Venmo provides a quick fix for us to fulfil their needs and complete projects quickly, according to Bates. It makes it so much easier for us to get suppliers paid for the projects we work on across North America. We have access to a lot wider network of independent contractors since we don’t have to bother with cutting and mailing checks or dealing with reordering or ordering them via our banks.

Effortless marketing

Venmo users who make purchases are potential brand ambassadors because their friends’ networks can see the transaction. In essence, the feed is free advertising for your business. Every time a customer uses Venmo to pay you, their friends and followers will be notified unless their settings are set to private. The Venmo feed promotes digital word of mouth, which has consistently been found to be the most effective strategy for gaining new clients.

Connection to customers

Businesses have the chance to engage with consumers thanks to the comment and like capabilities of Venmo. Through the social-style platform, you may lower barriers and encourage customers to communicate with your business.

The social networking capabilities of Venmo are fantastic, according to Morar. “Our customers feel more comfortable asking questions and are more likely to repurchase when we can connect with them and engage them.”

Venmo’s social elements may be very appealing to companies, in fact. Millions of Venmo users may watch the social stream, according to Josh Criscoe, a former director of communications for Venmo and current senior director of corporate affairs at PayPal.

“A retailer may welcome Venmo’s millions of highly engaged users by accepting Venmo payments,” he continued. “These users adore sharing their purchase activities on Venmo’s social feed, a strong recommendation engine to other Venmo users.

Security

Like PayPal, Venmo takes security very seriously. While some customers might be hesitant to link their bank accounts to an app, according to Browne, the majority of his younger clients have no issues doing so.

Younger clients that arrive at our door with Venmo already set up are the ones who use it. They share our passion for it. When we tell our elderly clients about it, they are highly dubious. None of them download it because they don’t want an apt to be connected to their bank account

How to set up Venmo

Venmo with PayPal

On your company’s mobile website, you have the built-in choice to accept Venmo payments if you already take PayPal (it is available only on mobile sites right now). There won’t be a Venmo button on your website if you take Venmo through PayPal. Your consumers will get the choice to “pay with PayPal or pay with Venmo” when they choose “PayPal Checkout” as opposed to the alternative. Customers then have the option to pay using their Venmo accounts, and if they do, they will get a receipt with the Venmo logo.

There is no extra cost associated with accepting Venmo payments through PayPal, and there is no additional setup required. Payments you accept through Venmo will be protected to the same extent as payments you take directly through PayPal.

Venmo without PayPal

Like many other software-as-a-service (SaaS) applications, Venmo is a component in a vast ecosystem of related goods and companies. Because of this, setting up Venmo without linking it with PayPal might be difficult at first.

You must first sign up for Braintree, another PayPal brand, and begin the implementation procedure through that service in order to take Venmo payments as a business without PayPal. You can’t take Venmo without Braintree, much like a car can’t function without its engine. Braintree is the one actually executing the transaction, so imagine Venmo as the sleek body of the automobile and Braintree as the engine.

Due to this interconnected system of goods, you will be asked to verify the Braintree compatibility list before you even log in to Venmo to create a business profile. This list outlines the app’s consumer needs, merchant requirements, processing costs, and testing choices. You may also examine a mockup of your Venmo integration on this list before going live. Once configured, a control panel will allow you to access Venmo and Braintree. You may set up several accounts to access that panel, just as with the majority of other SaaS solutions. This enables different personnel to keep an eye on and handle client transactions.

FAQs about Venmo for business

Is Venmo free for business?

No, using Venmo for business is not free. Venmo transactions are included in your existing rate if you currently pay for PayPal, but it is not a free service. Venmo is no different from other digital transaction platforms in that it levies fees for handling payments.

What are some alternatives to Venmo?

Despite having more than 75 million active users, Venmo is not the only digital payment method available. There are many and growing numbers of digital wallets. Three of the largest names in the cashless industry are listed here.

Apple Pay: According to Fortunly, Apple Pay, by far the market leader, has more than 500 million customers globally. You’ll probably see the Apple Pay logo at many of your favourite hangouts if you keep your eyes out. Learn how to integrate Apple Pay into your company.

Google Pay: According to eMarketer, Google Pay, formerly known as Android Pay, has 25 million active users in the United States alone. Both traditional brick-and-mortar establishments and online retailers accept Google Pay.

Zelle:Due to the magnitude of its subscriber base and peer-to-peer payment strategy, Zelle posted the largest direct threat to Venmo in 2021. In that year, it completed 1.8 billion payments.

Is Venmo good for business?

Before opening a Venmo or PayPal account (or using any other payment transaction service), consider the advantages and disadvantages. The price of accepting digital payments using apps resembling digital wallets is often comparable to the price of accepting credit card payments, but deployment and continuing maintenance also come at a cost in terms of time and labour.

Most business owners have the opinion that it’s not worth the bother unless they are losing money by refusing to accept a payment option. But you shouldn’t assume anything. Find out from your consumer base if they prefer to pay with cash, debit, or credit or prefer to utilize digital wallets. If the latter is the case and your company doesn’t already accept credit cards, have a look at our list of the top credit card processing businesses.