Why Venmo Is Bad For Your Business
I handle the bookkeeping for Creative Entrepreneurs and recently noticed many transactions hitting my clients’ books from VENMO. I instantly did a little research to figure out what VENMO was.
I quickly realized why it was so popular.
Venmo is a peer to peer payment service that is owned by Paypal. Venmo does not charge a fee to transfer money to friends or family.
Venmo is very clear and specific about using Venmo for business. The Venmo website states, “Venmo is a person-to-person payment service, and does not currently support payments to merchants or businesses.”
The use of Venmo for business purposes is a direct violation of their terms of service.
The Venmo website states:
“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.”
Venmo explains on their website
“If you send a Venmo payment to someone for a good or service, you could lose your money without ever getting what you paid for.”
Venmo continues on
“If you accept a Venmo payment from someone for a good or service and we later review the payment, we may reverse the payment, meaning you could lose both the payment and the item sold. This review process may not occur until after you attempt to transfer the funds out of Venmo.”
In researching a little further, I found that there is a way to use Venmo for a business. However, you must first become a Venmo Authorized Merchant. However – unfortunately, they only seem to be authorizing large service-based companies like Uber & Grub Hub to use this feature.
You can learn more about becoming an Authorized Venmo merchant at the link below:
Moral of this blog post:
Don’t use Venmo for business until they come out with a platform meant for your specific business.
There are so many other payment processors that offer a higher level of confidence. I use and refer all my clients to the QuickBooks Payments, which is fantastic, especially if you are already using QuickBooks Online.
Learn about QuickBooks Payments
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I would love to know what your favorite payment platform is? Were you aware that Venmo was not suitable for businesses?
Can I use Venmo to buy or sell merchandise, goods, or services?
Venmo User Agreement
Photo by Monica Sauro on Unsplash