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Trying to decide between Venmo and PayPal? You’re not the only one. These two big names in mobile payments are everywhere, but which one is better for you?
In this Venmo vs. PayPal comparison, we’ll take a close look at fees, security, and core features to help you pick the right platform for your personal or business payments.
Looking for fast transfers, solid security, or the best option for international payments? We’ve got all the details to help you pick the winner.
Key Takeaways
- Venmo has lower fees for business payments and for large instant transfers.
- PayPal charges slightly lower fees for credit card payments and small instant transfers. It also allows you to send money internationally, which Venmo doesn’t support.
- PayPal has stronger security with features like key pinning and early fraud alerts.
- PayPal offers more ways to pay, like PayPal Credit and rewards, while Venmo allows payments with balance, bank accounts, debit, and credit cards.
- Venmo is faster for U.S. standard transfers, taking 1-3 business days, while PayPal takes 3-5 business days.
- When it comes to PayPal vs. Venmo for business, PayPal is better because it works worldwide and offers many business tools.
- However, Venmo is better for personal use in the U.S. because it’s simple and has lower fees.
Venmo vs. PayPal: Side-by-Side-Comparison
| Feature | Venmo | PayPal | Winner |
|---|---|---|---|
| Account Fees | Free | Free | Tie |
| Sending Money (Domestic) | $0 for Venmo balance, debit card, or bank account; 3% for credit cards | $0 for PayPal balance or bank account; 2.9% + $0.30 for debit/credit cards | Venmo |
| Sending Money (International) | N/A | 5% + international fee ($0.99-$4.99) | PayPal |
| Receiving Money (Domestic) | $0 for personal payments; 2.99% for goods & services | $0 for personal payments; 2.99% for goods & services | Tie |
| Receiving Money (International) | N/A | $0 for personal payments; 2.99% for goods & services + 1.5% for international | PayPal |
| Business Payments (Domestic) | 1.9% + $0.10 (direct payments); 2.29% + $0.09 (tap to pay) | 3.49% + fixed fee | Venmo |
| Business Payments (International) | N/A | 3.49% + fixed fee + 1.5% international fee | PayPal |
| Payment Methods | Venmo balance, bank account, debit card, credit card | PayPal balance, bank account, debit card, credit card, PayPal Credit, rewards | PayPal |
| Instant Transfer Fee to Bank/Card | 1.75% (min $0.25, max $25) | 1.5% (min $0.50, no cap) | Venmo (for large transfers), PayPal (for small transfers) |
| Transfer Speed (Standard) | 1-3 business days | 3-5 business days (up to 7 days for certain countries) | Venmo |
| Security Features | Two-factor authentication (2FA), PIN, Face ID, encryption | 2FA, PIN, Face ID, encryption, key pinning, early fraud alerts | PayPal |
| Global Availability | U.S. only | Over 200 countries, 25 currencies | PayPal |
Does PayPal Own Venmo?
Yes, PayPal acquired Venmo in 2014.
Even though they are both owned by the same company, they have some differing features across the two platforms, which we are exploring further below.
Venmo vs. Paypal: How Do They Stack Up?
Venmo Overview
Venmo Pros & Cons
- Simple to use for fast payments between friends
- Free transfers from linked bank accounts
- Optional debit/credit cards
- Allows cryptocurrency purchases
- Only available in the U.S.
- Fees for credit card payments and instant transfers
- Not widely accepted by businesses
- Limited weekly transaction limits
- Some privacy concerns due to the social feed
Venmo is Best For
Venmo is best for personal payments, like splitting bills with friends or sending money to family. It’s great for people who want an easy and social way to send money, with free transfers from linked bank accounts.
However, because it only works in the U.S. and isn’t widely accepted by businesses, it’s not the best option for international payments or bigger business transactions.
PayPal Overview
PayPal Pros & Cons
- Available in over 200 countries and supports 25 currencies
- Tools for businesses, like invoicing, seller protection, and online store integration
- High transaction limits for personal and business accounts
- Allows cryptocurrency purchases
- Accepted by many businesses for both personal and business accounts
- Fees for credit card and debit card payments, instant transfers, and international transfers
- More complicated to use compared to Venmo
- Funds may be held for security reasons, especially for new or large accounts
- More fees for business transactions compared to Venmo
PayPal Is Best for
PayPal is best for personal and business use, especially for people who need to send money internationally. It’s great for businesses because it offers many tools, like invoicing and seller protection. PayPal is also ideal for online shopping and handling payments in different currencies.
However, for simple payments between friends in the U.S., Venmo might be easier to use.
Setting Up Accounts & Making Transfers
Venmo Account & Transfers
PayPal Account & Transfers
Venmo vs. Paypal: Which Is Better?
Venmo vs. PayPal Fees
When choosing between Venmo and PayPal, it’s important to understand their fees.
In this section, we will compare Venmo vs PayPal fees for various transactions, including within the U.S. and internationally. We’ll also look at the PayPal and Venmo transfer fees and what to expect when using these services for personal or business purposes.
Knowing the costs involved can help you decide which option is best for your needs.
Account Setup Fees
Winner: Tie
Both Venmo and PayPal are free to sign up for, and neither charges a monthly fee for personal accounts. You can start using both services without any cost.
Sending Money
- Venmo for domestic transfers
- PayPal for international transfers
Venmo:
- Using Venmo balance/debit card/bank (domestic): $0
- Using credit card (domestic): 3%
PayPal:
- Using PayPal balance/ bank account (domestic): $0
- Using debit/credit cards (domestic): 2.9% + fixed fee (which is based on currency received. If U.S. dollars, then $0.30).
- Using PayPal balance/cards/bank account (international): 5% + international fee (minimum of $0.99, maximum of $4.99).
Venmo charges a slightly higher rate for credit card payments than PayPal. However, Venmo allows you to use a debit card for free, whereas PayPal charges for both credit and debit card payments.
Venmo doesn’t support international transfers, so PayPal wins in that respect.
Receiving Money
Winner: Tie
Venmo:
- Fee for personal payments: $0
- Fee for goods and services: 2.99%
PayPal:
- Fee for personal payments: $0 (unless a currency conversion is involved – charged at 3% above base exchange rate)
- Fee for goods and services: 2.99%
Personal payments are free, and both charge a 2.99% fee for goods and services. PayPal has a currency conversion fee based on the fact that it offers international payments, while Venmo doesn’t.
Instant Transfer to Bank or Card
- Venmo for large transfers
- PayPal for smaller transfers
Venmo:
Instant transfer fee: 1.75% (minimum $0.25, maximum $25)
PayPal:
Instant transfer fee: 1.5% (minimum $0.50, but the fee is based on withdrawal currency)
PayPal charges a lower fee than Venmo, making it cheaper for small transfers. But Venmo has a maximum fee of $25, which means for big transfers, Venmo becomes cheaper because PayPal’s fees keep increasing with the transfer amount.
Business Payments
- Venmo for domestic business payments
- PayPal for international business payments
Venmo:
- Business profile transaction fees: 1.9% + $0.10 (direct payments), 2.29% + $0.09 (tap to pay)
- Charity profile fees: 1.9% + $0.10
PayPal:
- Business profile transaction fees: 3.49% + fixed fee (for most domestic transactions) OR 3.49% + fixed fee + 1.5% (for most international transactions). The fixed fee varies by currency, but if in U.S. dollars, it’s $0.49 for most commercial transactions.
- Charity profile fees: 1.99% + fixed fee (domestic) OR 1.99% + fixed fee + 1.5% (international). The fixed fee varies by currency, but if in U.S. dollars, it’s $0.49 for charity transactions.
Venmo has lower fees for business payments, making it cheaper for most business transactions in the U.S. However, PayPal is the only one of the two supporting international business payments.
Venmo vs. PayPal Fees Overall Winner: PayPal
Even though Venmo is cheaper for domestic transactions, PayPal is more flexible. It allows international transfers, making it the better choice for both local and global payments.
So, if you need one service for both domestic and international transfers, PayPal is the clear winner. If you just need domestic transfers – Venmo will be slightly cheaper.
PayPal vs. Venmo Security & Safety
How safe is Venmo vs. PayPal? Both PayPal and Venmo have strong security features to protect your money and personal information. However, they have some differences in how they handle account protection. Understanding how safe Venmo is vs. PayPal is essential for users who want to ensure their financial transactions are secure.
Here’s an easy comparison:
Login & Account Security
Winner: PayPal
Because it adds an extra layer of security with key pinning, which ensures your device connects only to safe PayPal servers.
Venmo uses two-factor authentication (2FA), meaning you’ll get a code on your phone to enter when logging in. You can also set up a PIN or use Face ID and fingerprint recognition for extra security. If your phone is lost, you can sign in from another device and remove access to the lost phone.
PayPal also lets you set up a PIN, Face ID, or fingerprint recognition and uses 2FA. If your device is lost or stolen, you can still log in with your password or a one-time code to remove access to the lost phone. PayPal also uses key pinning to make sure your device connects to secure PayPal servers.
Data Encryption
It goes a step further by using transport layer security (TLS). However, it’s worth noting that TLS is a common protocol used to secure communications over the internet, and it could be that Venmo also uses it—but it’s not mentioned anywhere on their website.
Venmo uses encryption to protect your account information and stores it safely on secure servers.
PayPal also uses data encryption but adds more security with TLS. This ensures your personal data stays safe during online payments.
Fraud Detection
PayPal wins because it not only monitors your account but also proactively detects fraud across its vast merchant network. Its early fraud alerts give you a chance to act before any damage is done.
Venmo monitors your account to detect unauthorized transactions and uses encryption to protect your financial information. However, Venmo doesn’t offer advanced fraud detection features like early fraud alerts. If there’s suspicious activity on your account, you’ll need to report it to Venmo’s support team to investigate further.
PayPal provides 24/7 fraud monitoring and uses advanced technology to detect suspicious activity. It also offers early fraud alerts for eligible cards in your PayPal wallet. PayPal’s system automatically spots risks and acts quickly to prevent fraud, giving users extra protection.
Venmo vs. PayPal Safety Overall Winner: PayPal
PayPal wins overall because it offers stronger security features like key pinning, which ensures secure connections, and 24/7 fraud monitoring with early fraud alerts. These advanced protections, combined with encryption through TLS, give users more proactive and reliable protection compared to Venmo.
Payment Methods & Transfer Speeds for PayPal & Venmo
Payment Methods
It has more options for payment methods.
You can pay with a PayPal balance, bank account, debit/credit cards, PayPal Credit, and rewards. You can set a preferred method for different transactions.
You can pay with a Venmo balance, bank account, debit card, or credit card, but there are fewer options than PayPal.
Transfer Speed
Since it’s faster for domestic transfers.
PayPal standard transfers take 3-5 business days, and transfers to certain countries can take up to 7 business days. Instant transfers to eligible cards take around 30 minutes.
Venmo Standard transfers take 1-3 business days, and instant transfers, depending on the bank, take up to 30 minutes.
Overall Winner for Payment Methods & Transfer Speeds: PayPal
While Venmo is quicker for domestic transfers, PayPal offers more payment methods, including options like PayPal Credit and rewards. PayPal is also better for international transfers, making it more flexible.
PayPal vs. Venmo for Business
When it comes to PayPal vs. Venmo for business, PayPal is the clear winner. It offers many tools like invoicing, seller protection, and supports international payments in over 200 countries.
PayPal works well with online stores and secures transactions, making it great for small and large businesses.
Venmo is cheaper for U.S. domestic payments but is more limited. It doesn’t have as many business features and doesn’t support international payments.
PayPal vs Venmo for Personal Use
For personal use, Venmo is the better choice for people in the U.S. who need a simple way to send and receive money between friends and family. It’s easy to use, fast, and includes a social feature that makes it great for splitting bills.
PayPal is more suitable for those who need to handle both personal and international payments or want more payment options like PayPal Credit. But for quick, everyday payments in the U.S., Venmo’s ease of use and low fees make it the better choice.
The Bottom Line
Ultimately, PayPal is better for businesses and international transactions because of its many tools and global reach. Venmo, on the other hand, is ideal for simple, U.S.-based personal payments with its lower fees and easy-to-use platform.
The best choice depends on your needs: PayPal is more versatile, but Venmo is perfect for quick, casual payments in the U.S.
