Here's Why You Shouldn't Use Venmo (2024)

FAQs

Why shouldn't you use Venmo? ›

Especially with Venmo, there are privacy issues. Unless customers know to set their transaction with you as private, notifications about it will be sent to their entire Venmo contact network. Concerns about customer protection. Once a Venmo or Zelle payment is sent, it is difficult if not impossible to get it back.

But finding yourself under investigation for potentially violating U.S. trade sanctions could be as easy as typing words like "Syria" or "Cuba" into Venmo. That's because the money-sharing app takes transactions a lot more seriously than users might realize.

Its ease of use and lack of service fees make the app a profitable alternative to usual bank transfers. However, Venmo is not without its drawbacks, including security concerns, fees for certain transactions, and privacy issues. As such, it's somewhat inefficient for instant money transfers.

Why Venmo Is Popular. Like Facebook, Instagram, and WhatsApp, Venmo grew exponentially through peer-to-peer networking. Users are attracted to the following features: Unlike its competitors, Venmo doesn't charge users to send or receive more money, although credit card-based payments are charged.

Some people prefer Zelle to Venmo; others love Venmo more. Both of the payment services are decently safe, have user-friendly interfaces, and allow you to conveniently send money when you need it. Zelle stands out from Venmo with its absence of instant transfer fees, but it also cannot be used as a wallet.

As mentioned, storing money in apps such as Venmo, PayPal, Cash App, and others could put your money at risk. Yet there's another downside you should be aware of as well. When you keep money in these types of apps, you don't have the ability to earn interest on your savings.

Not only does Venmo flag posts that mention countries sanctioned by the United States, it also flags anyone with a Middle Eastern name. In addition, any words related to drug cartels, terrorist organizations or any other state enemies risk getting flagged by the app.

And from there, you can use that money to pay bills or spend it as you normally would. Of course, if you know you have a payment due in a few days that you'll be sending via Venmo, then it's okay to leave that sum in your account. But otherwise, do yourself a favor and aim to keep your Venmo balance at or around $0.

Should I link my bank account to Venmo? ›

You need a bank account to make cash withdrawals. So if you plan to receive funds via Venmo and aim to cash them out, you need to link your Venmo account to a bank account.

Venmo differs from PayPal because it requires a bank account connection to complete transactions. Additionally, Venmo does not offer a refund policy in the case of scams as PayPal does. Both of these things make Venmo safety slightly more difficult.

61% of Venmo's users are male and 39% are females. According to a survey, 32.6% of teenagers use Venmo to pay for drugs. 50%(1.4m) of users of Venmo are aged between 25-34 years of age.

Safety Concerns with Venmo

Like other payment or banking apps that connect to users' bank accounts, using Venmo comes with the risk of security breaches, hacking, or data loss. Unfortunately, hackers and scammers have been able to circumvent these safeguards.

It's not safe to use Venmo with strangers you haven't verified. Venmo has security features in place to authenticate users and keep transactions secure, but scammers can make fake Venmo accounts to trick other users into unsafe actions.

Is Venmo safe to use? Venmo is safe to use when interacting with people you trust. It's not safe to use Venmo with strangers you haven't verified. Venmo has security features in place to authenticate users and keep transactions secure, but scammers can make fake Venmo accounts to trick other users into unsafe actions.

Venmo, Cash App, and PayPal are not FDIC Insured.

The FDIC (Federal Deposit Insurance Corporation) is an independent agency of the U.S. government that oversees insured banks, protecting customers against the loss of deposits.

Venmo differs from PayPal because it requires a bank account connection to complete transactions. Additionally, Venmo does not offer a refund policy in the case of scams as PayPal does. Both of these things make Venmo safety slightly more difficult.

Linking bank accounts to Venmo is generally safe, but not without risks. You should implement extra security measures when linking bank accounts or credit cards to Venmo, such as setting up multi-factor authentication on both your Venmo app and your online bank accounts.