For small businesses, every penny counts. That is why you need to know about the fees and additional costs before selecting a payment service for your business.
Online payment services are very useful, especially if you run an online business. A payment service helps you take care of the security of the payment, which can cost a lot of money if you go through a bank or a personalized system.
In this article, we’ll be discussing and comparing Venmo and Paypal. The pros and cons will be explored, and we’ll provide all the basic information you need concerning these two platforms.
What Are Venmo and PayPal?
Venmo and PayPal are two mobile payment services. Venmo was founded in 2009 and is actually owned by PayPal. Venmo is restricted to the U.S as both the sender and the receiver have to reside in the United States of America. PayPal is also an online payment system. It was founded in 1998.
We’ll compare PayPal and Venmo across a few features – Platforms, Payment Methods, Fees on Payments, Speed, Bank Transfers Fees, Limit, Geographical limitations, Business Features, and then give our final verdict.
Comparing Venmo and PayPal
- Platforms – PayPal is available on web browsers, smartphones, at online shopping checkouts, and even at in-store shopping checkouts. Venmo is used mostly on smartphones, online shopping, and in-store shopping. There are a few web features, but they are limited.
- Payment Methods – They both offer the same payment methods, which are bank account, credit card, debit card, and the balance available on the platform (Venmo and PayPal)
- Fees on Payments – PayPal does not charge payments from bank accounts, but they charge 2.9 percent and 30 cents if the payment is made via credit or debit card. Venmo is also free for bank accounts; however, they charge 3 percent for payments done via a credit card.
- Bank Transfers and Speed of Transfers – PayPal does not charge for bank transfers that take the usual time (one to two days.) However, if the user wants an instant transfer (capped at $10), they’ll charge 1% of the amount. Venmo also does not charge for bank transfers that take the usual time (one to three days) however;, they charge 1% for instant transfers (a minimum of 25 cents, and it is capped at $10).
- Transfer Limitations – PayPal allows up to $60,000 as well as a $10,000 limit for single transactions. Venmo allows up to $6,999.99 in transactions during the last seven days. Venmo only allows $4,999.99 for single person-to-person transfers.
- Geographical Limitation – PayPal is available in more than 200 countries, and it currently offers transactions in 26 currencies. Venmo is only for users in the United States.
- Business Features – PayPal offers tools to small businesses, such as the availability of a business account that can be used to handle financial transactions of sales online. They also offer invoicing, shipping, and insights on the market. Some of these features are free, while some are on the Pro Account. Venmo mostly focuses on person-to-person transfers.
Our Final Verdict
PayPal seems to be the better option for small businesses due to the plethora of tools it offers.