Using Your Venmo Card [Complete Guide]

By: Yara Pollard

With so many peer-to-peer softwares and applications available in the market, it can be hard to choose one that would fit your needs. Some factors that people take into consideration when looking for P2P apps is the speed and charges of doing fund transfers.

In today’s world, speed is everything. Everyone wants everything fast. Fund transfers that just take a day or two is something a lot of people want their P2P apps to have. However,  it’s not enough to have fast fund transfers. This is why Venmo produced their own debit card.

This is so people can just withdraw their balance from the Venmo app if they need cash on hand. What makes the Venmo card convenient is because you can carry cash without having to carry them at the same time.

This means that cash can be withdrawn if you need to pay for something using physical money but at the same time, you can just swipe the card to also make transactions. Depending on your need, the Venmo card can provide both.

What is a Venmo Card?

According to Venmo, “venmo cards are debit cards that operate using the network Mastercard.” Venmo started off as a peer-to-peer application used to send and receive money from family and friends.

But it has now released a physical card that can be used for purchases in physical merchants and online stores. However, its uses are not limited to the above mentioned. It can also be used for bills payment and atm withdrawals.

According to Investopedia, Venmo was founded back in 2009. It used to be a payment delivery system that is based on text messaging. In order to boost the popularity of P2P economy, Braintree which was a popular mobile payment organization acquired the Venmo company for $26.2 million.

Within less than a year after it experienced the boost of peer-to-peer economy, Paypal acquired the company Braintree for $800 million. In 2018, Paypal then released a debit card, bringing the digital app into the physical world.

According to Spend Me Not, Venmo has over 40 million users. It also has an average of 10 million active users each month. Venmo’s main target are people who belong to the younger generation.

According to Statista, Venmo had a 56% year-on-year growth in the fourth quarter of 2019. The report shows that the payment transactions of $12 million in 2018 have made a significant increase and are now at $29 million in 2019.

How Venmo Cards Work

Venmo cards are available to people who have registered accounts in the Venmo app. By linking credit cards, checking accounts and bank accounts into your app, cash can be transferred into your Venmo account and will be ready for use.

It is similar to the services that Paypal offers. Here are some features of the app that you can observe in Venmo:

  1. Fast cash transfers
  2. No charges in sending or receiving money from friends and family
  3. Can be used for online purchases

According to Experian, if users want to make purchases and transactions using the Venmo card, it will just use the amount that is available in the app. It does not use funds from your bank account or credit card.

Unless you make a fund transfer, your Venmo balance can remain empty. The good thing is if you’re low on funds in your bank account, you can always use credit cards to reload.

Another great thing about Venmo cards is that the users are able to choose the color of their card. It is also equipped with an EMV chip making it compatible with wireless transactions.

If Venmo cards are used at ATMs that do not belong to the Money-Pass network, you will be charged with a fee of $2.50. For withdrawals requiring signatures, a fee of $3.00 will be charged.

Moreover, ATM withdrawals are limited to $400 per day. An important thing to keep in mind is that Venmo cards can be used within the US. It does not support international transactions. Its use is also limited to merchants that accept or support Mastercard cards.

Benefits of Using Venmo Cards

Unlike credit cards, the Venmo card uses the current balance it contains. You do not incur debts when using it to transact with various merchants. Venmo cards are great alternatives for credit cards.

Although you use your own money to make purchases, it is still convenient for when you want money on the go. Because it is linked to the Venmo app, you can just check the remaining balance of your card and reload if needed.

According to Lendedu, these are some of the benefits you can get when using Venmo cards.

  • Can be used anywhere in the US that has a Mastercard acceptance seal.
  • No charge when used to withdraw money in ATMs that belong to Money-Pass.
  • Reloading is faster because of bank account linking.
  • Card colors are customizable.

Venmo Cards VS Credit Cards

Venmo cards, as mentioned above, do not have the ability to incur debts to its user since it is a debit card. This means that it uses funds that it has in its pool. Also, it does not require the use of credit scores to obtain one.

On the other hand, credit cards function by loaning its users money to make transactions without having to use their own funds. Each transaction made is converted into credit debt that needs to be paid in full at the end of each month.

Also, credit cards have requirements that need to be met in order to get a subscription. These include a positive credit history, a good credit score and etc. Having a good credit score itself is a challenge that is difficult to achieve since there are a lot of factors that need to be considered.

Another thing about credit cards is that it has a specific percentage of utilization per usage. In order not to have debt piling up, one has to be mindful of the do’s and don’t in using a credit card. However, these are not problems you’d encounter when using a Venmo card.

If you need another powerful financial tool that acts much like a Mastercard, a Venmo card might just be what you need. It’s more than just a debit card. 

Related post