Bankrate’s guide to using Venmo

2 min read

Venmo is a mobile app that makes peer-to-peer money transfers simple and inexpensive (or free). The app is mobile-only, meaning you can’t send or receive money on a desktop computer. You can, however, transfer money using the app via iMessage and special emojis.

The goal of Venmo is helping consumers navigate split checks and other situations where dollars need to change hands in a world where having cash is rare. Sharing the cost of a cab ride with a friend, paying a colleague back for happy-hour drinks, or even sending your roommate your half of the rent, Venmo is getting used every day for these examples and more. If you go out to dinner with friends, one friend can pay the bill while the others Venmo their share to that person. It’s easy to use and better yet, there are no excuses for friends not paying you back!

How Venmo works

Venmo works for people who have Venmo accounts. You can only send or receive money with Venmo if you have an account set up. You also need to download the Android or iOS app. You can also set up Venmo with iMessage or Siri voice command. It’s worth noting that payments funded by a credit card incur a 3% fee.

Make purchases online. Since Venmo is owned and operated by PayPal, it shouldn’t surprise you that some online merchants accept Venmo as payment. Venmo claims you can try to pay with the service any time you see a PayPal button, and that you may also see a Venmo button on certain merchant’s payment page. When you make purchases online using Venmo, there are no fees — even if you use a credit card.

You can fund your account with plastic or checking. You can fund money transfers with a credit card, a debit card, a prepaid debit card, or a checking account, but not a savings account.

You need a bank account to make cash withdrawals. If you plan to receive funds via Venmo and aim to cash them out, you need to link your Venmo account to a bank account.

How much does it cost to use Venmo?

We already mentioned how, if you use Venmo for online purchases, you will not be assessed a fee — even if you use credit. You can also send money for free to friends provided your transfer is funded by a balance in your Venmo account or a debit or prepaid card.

Instances where you’ll pay to use Venmo include:

  • Standard transfer service — You’ll pay a standard fee of $.25 to transfer money instantly from the app to your bank account. You can also cash out to your bank account for free, although you won’t receive your funds for up to three days.
  • Credit card transfers — If you transfer money from a credit card, you’ll pay a flat 3% fee.

How to get started with Venmo

If you’re eager to find a way to transfer money to friends, start by downloading the Venmo app and complete your personal information: phone number, email address, and bank account number. You’ll also need to create a Venmo log-in and password to secure your account.

Note that, when you first open your account, you’ll have a rolling limit of $299.99 per week for payments and purchases. Once you verify your account, the limits increase to:

  • $2,999.99 rolling weekly limit for sending funds.
  • $2,000 merchant transactions.
  • $2,000 per transaction with a Venmo debit card.

Venmo Mastercard®

Venmo offers a Mastercard debit card that lets you use your Venmo balance anywhere Mastercard is accepted. Limits for the Venmo Mastercard® are:

  • $3,000 per purchase.
  • $400 daily limit for ATM withdrawals, over the counter withdrawals, and cash back with purchase transactions.

Is Venmo secure?

Venmo uses encryption to keep your funds and account details safe. They also use multi-factor authentication to confirm your identity and add another layer of security.

The Venmo app offers additional security features you can access as well, including pin number and fingerprint-based log-in options.