Computerized Investing > May 20, 2017

Transferring Money With Venmo for iPhone and Android

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by Jaclyn N. McClellan

Free

Venmo is a payment application (owned by PayPal) that allows users to transfer money from their bank account to other Venmo users for free (transferring money from a credit card will cost you 3%). This comes in handy for those who need to split payments with friends or transfer money between two different banks. Venmo also connects to many applications, allowing users to pay using Venmo instead of having to input credit card information for every transaction.

Getting Started

When you download the application, you’ll be prompted to create an account.

Once in the application, the menu icon is in the upper left-hand corner. Menu options include: home, search people, invite friends, transfer to bank, purchases, notifications, incomplete, get help and settings.

After creating an account, you need to input your bank account information. Tap “settings” within the menu, then select “banks and cards.” This step is necessary so that when someone transfers money to you using the Venmo application, Venmo knows where to send the payment. Also, in order to send payment to someone else, Venmo must have an access to an account to draw the money from.

Connecting With Others

Your friending options are at the bottom of the Privacy screen, which can be accessed by tapping the menu button in the upper left-hand corner of the application, selecting “settings,” and then selecting “privacy and sharing.” The “friending” options are at the bottom of this page. (Don’t worry! More information on the privacy section is described later.)

Users can select to turn on friending options for their Facebook friends and also their phone contacts. If you created a Venmo account through Facebook, the Facebook friends options will automatically be toggled on. If you created an account using your email address (without connecting through Facebook), the “phone contacts” friending option will automatically be selected.

To send someone money, or receive money from them, you must be their “friend” on the application. If it is someone already in your contact list on your phone (and you’ve selected the “phone contacts” friending option described above), you shouldn’t have any issues sending or receiving money.

To invite friends who do not currently have Venmo, select “Invite friends” from the menu. Venmo will show all of your phone contacts who are not Venmo users. By selecting a name from the list, an invitation to join Venmo will be sent to your friend.

Sending/Receiving Money

As mentioned earlier, you must input your bank account information to send or receive money. Before you can transfer money, your bank account must be verified. This can be done in one of two ways: instant verification (providing Venmo with your bank account username and password) and microtransfers (when adding a bank account to Venmo manually with your routing and account number). For more information, click here.

After your bank account has been verified, sending and receiving money is a quick process. If you are already friends with someone on Venmo, select “search people” from the menu and then search their name. Once you’ve selected their name, choose the option that says “pay or request.” Users can also send money by selecting the icon in the upper-right-hand corner of the application (from the home page).

To see your past transactions, click the icon that is shaped like a person’s head on the top of the Venmo application. This shows transfers you’ve made, and who has transferred money to you.

When someone sends you money, it does not automatically transfer to your back account. You need to tap the menu button, then select “transfer to bank.” Users have the option to determine how much to transfer from Venmo into their bank account (by default the app chooses your total Venmo balance). If you’ve linked several bank accounts to your Venmo application, the app lets you select which account you want to transfer money into. The app also displays an “estimated arrival” date so users are aware of when the money will be available.

Be sure to verify that you’re sending money to the right person, and for the right amount, before you send it. The funding source and amount of payment can’t be changed once it’s been sent. Venmo mentions, “If you sent a payment using iMessage and it hasn’t been accepted yet, or it went to a ‘New User,’ you will still have the option to cancel the payment. You can read more about that here. Please see the article on how to update your primary funding source, so that the correct payment method is debited for next time!"

Venmo places a limit on the number of credit/debit cards a user can add to their account for security reasons. Users can have up to six active cards in their account at any given time. Also, there is an eight-card limit on the number of cards (including deleted/removed cards) that a user may have over a six-month rolling period. For more information click here.

Privacy and Security

On the home page of the Venmo application, you can see what payments your contacts have been making and to whom. If you do not want other people to see transfers you’ve been making, I highly recommend that you change this setting within the application.

To do so, open the menu in the upper-left-hand corner, select “settings,” then select “privacy and sharing.” The first item regards the audience of your future transactions: the available selections are participants only, public and friends. I recommend choosing “participants only” if you don’t want other people to see your transactions.

The second item is “who can share transactions involving you?” Options include everyone or only me. I recommend choosing “only me” if you do not want other people to be able to share your transactions.

The third item says “past transactions,” and the options are “limit to friends” or “make all private.” To prevent Venmo users from seeing your past transactions, click “make all private.”

The last option on the Privacy page is your friending options, which was talked about in the Connecting with Others section above.

If you choose to connect through Facebook, you may want to read Venmo’s privacy policy and the information mentioned in Figure 3.

To make your application even more secure, from the menu, select “settings,” then select “Touch ID & PIN.” Venmo prompts you to set up a PIN passcode, which will be used to access the application. For iPhone users that have this capability: It will also activate the Touch ID feature that requires your fingerprint (if you’ve set this feature up on your phone).

For more information on Venmo’s security, click here.

Conclusion

Venmo is an excellent way to send money to people. This is particularly useful for those who may wish to split dinner checks or have the need to transfer money to someone quickly. For those who have a Chase bank account, Venmo can replace Chase Quickpay for non-Chase users.

If you have more questions about the functionality of the app, it is worth checking out Venmo’s Help Center.

This app works for your family and friends within the United States. In order for you to pay someone else, they must also create a Venmo account.


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