Venmo vs PayPal: Which one Is The Best Digital Wallet in 2021?

With the ever-evolving world of technology, getting things done is almost at a fingertip. And when it comes to the fin-tech industry, making the payment has been simplified.

Money transfer apps such as Venmo and PayPal are offering excellent services in making sending and receiving money and other transaction a lot easier for customers.

Though there are more mobile payment apps available such as Google Pay, Square Cash, and others. And choosing a payment platform to suit your needs is now a considerable task to bear, due to the various options available in the market.

PayPal has won the accolade for the strongest in the payment service demand due to its long term existence . It came to the fin-tech market in 1998.

Back in 2013, PayPal acquired Venmo , another payment application for an amount of about $800 million. Now, the two payment service application has been monopolizing the market.

Venmo vs PayPal: Which one Is The Best Digital Wallet in 2021?

Below is a summary of the key features of both platforms.

PayPal

Venmo

  • Available in over 200 countries
  • Only available in the US
  • It is for business owners
  • For everyday users
  • It is safe and secure
  • It is safe even though it is public. But it poses some risks.
  • Transfer limit is $10000
  • Transfer limit is $3000
  • Withdrawal time frame is about 1-2 days
  • Transaction delivery time frame is 1 day
  • Debit card fee is 2.9% plus 30 cents
  • The debit card fee is free.
  • Credit card fee is 2.9% plus 30 cents
  • Credit card fee is 3%
  • The bank transfer fee is free
  • Free
  • Account title is tied to Email Address
  • Account title is tied to the phone number

PayPal - Link

PayPal
PayPal

It is one of the first digital wallets and payment services and has dominated the market for money applications with a massive base of faithful clients.



Features:

  • PayPal payment service assists its customers to attach their bank accounts, including their debit or credit cards to their accounts.
  • It helps its users to send and also receive payments on their smartphone devices.
  • PayPal is on the forefront of rendering products and services to consumers and businesses.
  • It commences as a payment provider to eBay, and it has since improved itself into a banking system that renders services like business loans and other financial products.
  • It now dominate the fin-tech industry, and overseeing 60% market portion among other payment platforms.
  • PayPal service was established in 1998 and went public in 2002 by a faction of high-profile entrepreneurs, which include Telsa CEO Elon, and Peter Thiel.
  • Since its inception, the PayPal Company has also finalized different successful procurement, which includes Venmo.
  • PayPal has a strong active-customer base, which is around 267millions.
  • In the final quarter of 2018, PayPal had a total volume payment of $163 billion.
  • PayPal charges a cost of 2.9% plus $0.30 for payments from credit and debit cards.
  • It offers free transfer from PayPal balances.

You can check out: PayPal Alternatives: 10 Best Online Payment Apps

Venmo - Link

Venmo
Venmo

It is a payment platform that delivers exceptional service to its users.

Features:

  • It is a mobile app that permits its customers to receive and send cash or money from friends and phone contacts.
  • It connects its customer's bank accounts and also, its debit and credit card.
  • The application is owned by PayPal. They (PayPal) acquired it in the year 2013.
  • For now, it is only accessible to customers living within the US .
  • It is a smartphone payment service that carries out a transaction on a small amount of money or cash transfers.
  • Venmo payment service came to being in 2009. And it went public as a cash transfer application in 2012 for both android and iPhone users.
  • It uses the peer to peer (P2P) market platform to assist customers to allocate payment by relating their debit and credit card to their bank account and their service.
  • Bank transfer from the application is free of charge . But, there is a small fee for transfer to cards.
  • Venmo has beheld tremendous development in payments in the last quarter of its financial year.

Differences between PayPal and Venmo

The two payment platforms do have a lot of similarities, such as:

  • They belong to the same parent company.
  • They share a slightly similar fee format and overall layout.

But, irrespective of the similarities, these two money transfer apps do differ in some specific features. And below are some of the significant differences between them.

You can watch this YouTube video of PayPal vs Venmo:

Security differences

The most important interest for customers while selecting a digital payment service or money application is its security regulations .There have been almost no occurrences that have brought up red flags in the past regarding security.



  • Venmo guarantees high-grade encryption and security . The application provides its customers with a personal PIN code for mobile transactions.
  • PayPal has a similar encryption and security system, which is in a position to safeguard customers' accounts .
  • Venmo needs customers to register an account before money transfer can occur. But PayPal does not need contacts or "friends" for you to transfer money.
  • PayPal ensures that your bank details are not seen by those you're sending money. While on Venmo, bank details of the transaction are visible to the recipient.

So, it is very crucial to contemplate PayPal and Venmo security complications.

Business differences

  • These payment services have several business plans for small businesses. It also gives outstanding business payments and services.
  • PayPal provides a plan tagged " Business in a Box" that offers:

i. Payment processing

ii. an online store set-up

iii. financial records monitoring and structuring

iv. Means for funding through PayPal Working Capital or PayPal Business Loan.

  • PayPal enables point of sale and credit marketing, with mobile card readers.
  • A fee of 2.7% for swipe and check-in transactions.
  • An additional fee of 3.5% with 15 cents for keyed transactions.
  • It charges a 2.7% plus an extra 1.5% cross-border fee for none US cards.
  • But, businesses that make use of Venmo for their payments for goods and services are quite small. Because Venmo has less business-like features. Its system is more for peer to peer transactions. It does not give any outstanding lucrative fees or loans for business consumers.
  • PayPal is originally made to work with businesses in addition to catering for individuals in making digital payments and transfers easy. Hence, its design is very much suited for business.

You can read How to Get Your PayPal REST API Credentials

Transfer Limit differences

  • Venmo gives a minor transfer limit plan than PayPal.
  • Venmo only allows its customers to transfer up to only $3, 000 per time. While PayPal allows $10,000 per time .
  • The limits of transfers depend on the kind of service which is in use.
  • Venmo is covering only all the day-to-day bargains and transfers of money to families and friends. While PayPal is formulated for everyday transactions and also transfers and bulk withdrawals.

Social differences

  • PayPal does not provide any connectivity. Whereas, Venmo offers a social media-like platform to interact publicly or privately, over transactions made.
  • Venmo also allows its customers to make comments, likes, and send emojis' as they are busy doing transactions either with their friends or family.

Charges differences

  • Both applications are free to use and download .
  • But, they still both charges a 2.9% service charge for all debit and credit transfers.
  • PayPal charges an additional cost for credit transfers at 30 cents .
  • Venmo doesn't charge for debit cards and but charges 25 cents for transfers to debit.
  • Both of the services enable free transfer to bank accounts.

Withdrawal differences

  • Venmo and PayPal have identical withdrawal speeds.
  • PayPal has a withdrawal speed of about one to two days of business . The withdrawal rate for Venmo is faster , with just only one business day.

User base differences

  • Venmo is only accessible to American users.
  • But, PayPal is available in over 200 countries .
  • PayPal is much better for businesses that regulate on a universal scale.
  • PayPal has a user of about 254 Million.
  • Venmo has a user of about 38.7 Million.

Can I Have a PayPal and Venmo Account?

Yes! I hope you're happy to know you can operate both Venmo and PayPal accounts at the same time?



  • This is vital for business holders who aspire to use PayPal for their business deals and Venmo for their private transactions.
  • This enables them to segregate their private and personal life. Because of the separation of the accounts for their aims makes the most sense.
  • In case you have clients often visiting your site to purchase either digital or physical commodities, it is better to make use of PayPal to receive their payment.
  • If you are out for a dinner night and you desire an excellent way of splitting bill by halves, the Venmo application is of best use if you live within the US.

Similarities in PayPal vs Venmo

  • They can both be used for online payments because they are digital platforms.
  • You can create free accounts on both platforms.
  • You can connect them to your bank accounts .
  • You can use both services to transfer money to families and friends .
  • Both services are of use for both Android and iPhone users.

Advantages and Disadvantages of both Services

Advantages of PayPal

  • Simple to use
  • Users for iPhone and Android are able to download
  • Very safe to use
  • It is accessible in over 200 countries
  • It proposes solutions to business challenges.
  • It gives discounts for faithful users.
  • You only need an email address to register for a PayPal account.

Advantages of Venmo

  • Simple to use.
  • Account creation is free.
  • Users for iPhone and Android are able to download
  • Safe to use
  • Simple to attach bank accounts
  • It allows you to send money to families and friends very quickly.
  • It allows you to send messages to friends.

Disadvantages of PayPal

  • You will need to pay a specific cost to receive payment.
  • Due to suspects of suspicious activities, it has a system that can freeze accounts without warnings .
  • Additional charges by some banks for money transfer from PayPal.
  • It is not very safe and secure.

Disadvantages of Venmo

  • $3000 is the maximum you can send.
  • Many business enterprises do not propose payment for Venmo.
  • Both parties need to have an account on Venmo before you can send payments.
  • It is only accessible in the US.
  • You will need an acceptable telephone number to obtain an account.

Conclusion

The use of PayPal is best for medium-scaled e-commerce business that transacts to international agents. But, if you are within the US, and you trade only in small payment, Venmo is the best.

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