PayPal today announced that "more than two million" retailers in the United States will now accept online payments from the PayPal-owned, peer-to-peer payments platform Venmo. Users with Venmo accounts will be able to pay on retailer apps like Forever 21, Foot Locker, and Lululemon starting this week (via Reuters).
With the addition of Venmo into the checkout process of these apps, Venmo customers can use their app balance, linked cards, or bank account to shop on the mobile sites of "almost all merchants that accept payments with PayPal." The peer-to-peer payments app will appear as a checkout option similar to PayPal and other mobile wallets.
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“At Venmo from the very early days our vision was to always let you use it for whatever you want to buy,” Ben Mills, head of product, at Venmo, said in an interview.
Venmo will charge merchants fees for processing payments through its platform, with Venmo head of product Ben Mills stating that the service's ease of use "could help increase" the company's sales.
Another update coming down the line -- first announced over the summer -- will let users transfer their app's balance to their bank account instantly, for a transfer fee of $0.25. Currently, Venmo transfers to bank accounts are free, but take up to a day to complete.
PayPal is said to be looking to bolster Venmo's stance in the peer-to-peer payments market following the launch of Zelle earlier in 2017, and the impending debut of Apple Pay Cash. However, PayPal CEO Dan Schulman has said he doesn't think Apple Pay Cash will hurt Venmo, mainly citing Venmo's availability across platforms as its leg up on Apple's iOS-only P2P payments.
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(View all)ApplePay is currently accepted at more than 4 million locations and more than 1,500 banks are part of the program.
If Zelle is used by a big enough group of the smartphone population in the U.S., it'd become a serious threat to Venmo - however Venmo may have already won the marketshare race - making it very hard if not impossible for Zelle to overcome.
Frankly, the U.S. government is mandated to provide currency for citizen transactions and should provide an electronic form without transaction fees that provides transaction privacy like cash does - the financial industry would not want this to happen, but this is what should really happen, IMHO.
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