In 2013, Venmo became a part of PayPal and now it is one of the most widely used mobile applications for person-to-person payments in the United States.
Earlier, it was possible to use Venmo account only for person-to-person transactions (for example, for paying back friends) or making online purchases. Of course, it was possible to transfer funds from Venmo balance to a bank account, but now everything is even easier.
Venmo is introducing a debit card for the real world which will let users spend their Venmo balances not only online but in any physical locations that accept MasterCard as well.
At the testing stage the company has been considering an opportunity to use a physical Visa card but then has changed its mind and now is ready to introduce its MasterCards in a vertical design.
Now Venmo users can get in line to receive their debit cards, moreover, having a chance to choose from a selection of colors. The cards will have a chip for security but it will also be possible to make contactless payments.
Users do not have to pay for signing up to get a card. But currently such an option is available only in the United States.
The card will be accepted at ATMs and there will be no fees for using it within the MoneyPass network, still if one wants to use it for transactions on other networks, there will be a fee of $2.50 per transaction (without taking into account any fees that some ATM operators may charge).
The company has made tracking Venmo card activity simple. It will be possible to look through all card purchases in Venmo transaction history. Moreover, those users who have switched on Venmo notofications will be notified on their phones about each transaction. In case the card is lost, it will be enough to make just a few taps in the app with a view to disable it.
PayPal has taken a decision to roll out the debit card for Venmo app having an aim to gain an edge over its main rivals, as the competition in the digital payments environment, and especially in the person-to-person sector, is becoming more and more serious: last year in the United States, a consortium of a number of major banks introduced Zelle – a network that enables users to send money to each other via their smartphones. Cash app – another Venmo’s rival run by Square Inc. already offers its users an opportunity to spend their balance through a debit card.
As it was announced, in the first quarter of 2018, Venmo processed $12 billion in payments. In the same period, over $25 billion was moved on Zelle’s network. Transaction volumes of Cash are not disclosed.