Venmo announced support today of instant transfers to U.S. bank accounts. Users of the PayPal-owned payment app can move money out of their Venmo account to a bank account instantly.
Take the Express train: Venmo already offered the ability to transfer money out of Venmo to a bank account, but that took one to three days. This new instant transfer service works in a matter of minutes.
Increased monetization: Venmo’s standard bank transfer service is free. Users who want faster service can pay up.
- To use instant bank transfers, it will cost 1 percent of the money transferred with a minimum fee of $0.25 and a maximum fee of $10.
- Venmo launched a similar service for instant transfers to debit cards earlier in 2018.
- Venmo continues to search for monetization channels to capitalize on 40 million active accounts. These efforts include debit card and merchant fees for using Venmo.
- Competition with Square’s Cash App continues to increase, as both firms are aggressively trying to bring in new users
More options for instant: In addition to Venmo instant transfers, U.S. consumers are getting a lot more options to make instant payments.
- Visa Direct, the company’s instant push payment, experienced 100 percent year over year transaction growth
- Mastercard Send is helping gig and hourly workers tap into their earned wages instantly.
- The Federal Reserve announced last week that it will develop an instant payment platform called FedNow that would compete with the privately-owned The Clearing House on real time payments