PayPal and Venmo are two popular payment platforms that can be used for exchanging money transfers with friends, relatives, and customers. Thanks to convenient and user-friendly interfaces, both systems are in high demand now. Even though the basic working principles they have in common, some features differ one from another. In this review, we will compare PayPal and Venmo and help you find out which payment platform suits your needs better.
Comparing the Metrics
First of all, we have to point out one interesting fact. Venmo is owned by PayPal. Ha! Really a few people know that. The bottom line is that Venmo is mainly used by US citizens, while PayPal can function globally. The reason for that may be the fact that Venmo is used for everyday transactions between family and friends most of all, while PayPal is mainly exploited by business owners.
Millennials seem to love Venmo more because it has some social media features. For example, users can make their transfers public, and their friends will see these transfers. Yeah, even though Venmo is a trendy platform, SMEs still prefer more traditional PayPal.
Let’s have a closer look at the primary metrics of both payment platforms in the comparison table.
| PayPal | Venmo |
| Available in 200 countries | Available only in the United States |
| Cross-country transfers supported | Transfers only within the USA |
| 1-2 business days withdrawal time | 1 business day withdrawal time |
| $10,000 transfer limit | $3,000 transfer limit |
| Global acceptability | Acceptability limited to a few US-based retailers |
| 2.9% +30c debit card fee | No debit card fee |
| 2.9% +30c credit card fee | 3% credit card fee |
| No bank transfer fee | No bank transfer fee |
| Secure | Secure (public transfers are questionable, though) |
| Lots of opportunities for integration | Limited prospects for integration |
| With API or PayPal Plugins, businesses can collect payments via PayPal | Businesses need Braintree or PayPal Checkout to collect payments via Venmo |
| Focused on business owners mainly | Focused on everyday users (P2P) |
Which Platform is Better?
Well, that is a tough question, and perhaps there is no accurate answer because everything depends on your needs. Take a moment to think out what features you want a payment system to have, and then choose. It may be hard to decide; we also want to remind you that you can install both payment systems at any moment.
Both PayPal and Venmo allow you to link a card to your account as a payment method. If you use a debit card, you will be charged no fees but if you prefer a credit card, then be ready to pay a 3% fee to Venmo. When somebody sends you money via PayPal or Venmo, you can choose to transfer them to a linked card or leave them on the account balance.
As Venmo was initially developed as a platform for small-scale transactions, such as splitting a dinner bill or paying for a shared apartment, it has quickly become popular among everyday users. On top of that, the founders made a convenient app that allows users to manage all transactions and make quick money transfers by using a Venmo QR code that is unique for every client. Many people use it to socialize with each other, as everyone can make their transaction details public.
Choose Venmo if you intend to use it for the following purposes:
- Sharing a bill for a meal with friends
- Paying for a rented accommodation
- Socially sending payments
- Accepting money transfers from friends
Choose PayPal if you need it to fulfill the following activities:
- Sending international transfers to family or friends
- Accepting or sending large amounts of money
- Buying or selling things online
Summary
As you can see, both payment platforms have their cons and pros as well as accurate use cases. Venmo is a convenient platform for small-scale P2P transactions, such as splitting a bill; meanwhile, PayPal is designed to carry out large international money transfers and is oriented mainly on business owners. So if you have an online store, for example, we recommend you to pay attention to such payment systems as PayPal, Braintree, or Stripe, as they will address your needs and the needs of your clients better.
And in case you are an everyday US citizen looking for a comfortable and fee-free digital wallet, Venmo may come to your taste much more. Besides, we think you will adore the public transfers feature to stay aware of your friends’ activities.