Venmo for Business is Now a Reality!
Do you have a small business or Side Hustle and always dreamed of taking credit cards, but the process seemed too complicated? Well, it looks like VENMO is finally here to change all that.
I recently tested the new plan out for my 16-year-old daughter’s art business, phiaTcreates.com — We were able to set her up in minutes, and now she can accept credit cards at a lower rate than most credit card services offer. Want to learn how for your business? Read below to get all the details based on my personal experience.
What is VENMO?
You can skip ahead, but for those that don’t know, read on. VENMO is a company that allows friends and families both living in the US to exchange money at no charge. In 2013 they were acquired by PayPal for 800 million dollars. For good reason, apparently, because in 2020, the company generated $159 Billion in total payments and $450 million in revenue.
VENMO has become increasingly more popular. Users are getting more creative as well. Recently, on a trip through Portland, I saw a homeless man holding up a sign that read, “Cash preferred, but Venmo Works too!” It included his Venmo account as well. I looked it up, and it seemed legit. I had no idea who I was actually sending money to, so I didn’t continue. As a rule, it is best not to send money to people you do not know. But, I must give the man props for creativity.
VENMO for Business
Unlike the personal version, Venmo for business allows users to take full advantage of a VENMO payment on their web page or in person for their goods and services. In addition, a business account is easily attached to your personal account in a matter of minutes.
Many restaurants are already offering such service by placing a QR code on their receipts to expedite and increase touch-less payments.
VENMO Business Fees
VENMO does not charge any monthly fees, which really helps those just getting started. They are also offering zero seller transaction fees during a users’ first month through 6/30/2021. After the preliminary period, the charge is only 1.9% + $0.10 per transaction.
For example, for a $100 sale, you would receive $98.
$100 x 1.9% = $1.90
$100.00 – $1.90 = $98.10
$98.10 – $0.10 = $98
Using a credit card to send money personally through Venmo includes a 3% fee charged to the sender. However, credit card purchasers are exempt from the 3% purchaser fee when interacting with business accounts.
Like any similar program, fees can change at any time. But while there is no monthly fee, the barrier to entry risk is negligibly low.
VENMO Business Uses
I recently saw VENMO for Business used in a very creative way. For example, a musician at a Colorado backyard BBQ had his QR code set out. Anyone could scan this code, give him a tip or buy his t-shirts and CDs.
Other’s often use personal VENMO for tips, which seems to be a grey area of the terms and agreements of VENMO. Since a tip is not a direct exchange for goods or services.
The advantage of switching to a business account is to let users pay with a credit card and scan a QR code. Additionally, it’s much easier to scan a QR code than type in a VENMO account name, especially after a few adult beverages.
Some may continue the current approach to avoid the business fees. They may not want to collect only $0.88 on a dollar tip. However, people may tip more if they can use a credit card. Those who continue such usage could ultimately lose their account should VENMO go that route. Also, it bears repeating that tipping may get become forbidden in a future revision of the terms.
VENMO Business Profile
Venmo also offers business profiles. This solution allows small businesses to be found within the APP and generate more sales.
VENMO QR KIT
The VENMO QR Kit ships to your home for free (including $0 shipping). It includes lanyards, stickers, and a tabletop display. After a customer scans your QR code, they are taken directly to your VENMO account to complete the transaction.
(It’s unclear when this promotion ends)
Finals Considerations if You’re Thinking of Trying VENMO for Business
1) Even if you do not plan to use the business plan right away. It’s worth setting up now to take advantage of the FREE QR CODE KIT. Some may be scared off by the fees. But fees for payments are a normal part of doing business.
2) Anyone paying your business must have a VENMO account. However, consumers are becoming increasingly more comfortable using such services. VENMO, ZELLE, PAYPAL, GooglePay, AppleMay, and more becoming available daily.
3) Taxes due from Venmo Personal or business payments are 100% the responsibility of the receiver. Additionally, VENMO’s terms of service explicitly prohibit using personal accounts for business purposes. This excerpt from their terms reinforces that:
“Venmo may NOT otherwise be used to receive business, commercial or merchant transactions, meaning you CANNOT use Venmo to accept payment from (or send payment to) another user for a good or service, unless explicitly authorized by Venmo.”
With the addition of Business accounts, with fees, VENMO may likely attempt to crack down harder on those that violate these terms.
You will need to be a personal VENMO user first to create a VENMO Business Account.
4) I initially struggled to set up my account because it can ONLY be done from the VENMO APP, not the website. Unfortunately, I could find no reference to this requirement at the time of this writing. But knowing that one item may save you some frustration.
5) With no fees, there’s really no risk to get started, so give it a try today.
To get all the details and get started today, you can read VENMO’s official Getting Started Guide!
I do not work for VENMO. Nor do I benefit from anybody signing up. I am merely sharing my experience to help others. In fact, VENMO only allows referrals on a one-to-one basis through the app.