Using Venmo For Business: Fees, Features, & How To Get Started
Learn how to use Venmo in your small business, from showing you how to set up your business profile to discussingVenmo payment processing fees and transaction limits.
Venmo for Business can be used online or in-person using QR codes and the Venmo smartphone app to make and accept payments, making it one of the easier alternative payment methods to implement.
Of course, what merchants really want to avoid is paying all the processing fees that come with accepting credit cards and maintaining a merchant account. Venmo for Business doesn’t offer all that much help here. Your business transactions will still be subject to processing fees similar to what merchants pay to use a payment service provider (PSP), such as PayPal or Square. However, Venmo business fees are simple and predictable. You won’t have to worry about the hidden fees, long-term contracts, and cancellation penalties that often come with a merchant account.
Venmo’s unique social features can also help boost sales or draw attention to particular products, as friends of your customers will be able to see their purchases on their Venmo accounts.
Table of Contents
- Can You Use Venmo For Business?
- Should You Use Venmo For Your Business?
- Venmo For Business Fees
- How Do Venmo Business Accounts Work?
- How To Make A Venmo Business Profile
- How To Accept Venmo Payments As A Small Business
- Using Venmo Payments Without A Business Profile
- Final Thoughts: Venmo For Business
- Common Questions About Venmo For Business
Can You Use Venmo For Business?
You can use Venmo for business transactions by creating a business profile in the app. Once you’ve done that, you’ll be able to accept payments using in-app purchases, a Pay With Venmo button on your website, or QR codes for in-person transactions.
Should You Use Venmo For Your Business?
Here are some pros and cons of using Venmo for your sales:
- Avoids credit card interchange fees
- No hardware requirements beyond a mobile device
- Low transaction fee (1.9% + $0.10)
- Built-in social marketing platform
- Contactless payments
- Nonprofits can benefit from using Venmo
- Your customers also need Venmo accounts
- You’re responsible for sales tax
- Limited reporting and customer management tools
- Higher fees when not used peer-to-peer
- Transaction limits may be an issue for high-volume businesses
Venmo For Business Fees
Unlike personal accounts, Venmo business accounts have transaction fees. These are:
- 1.9% + $0.10 per transaction for purchases made using the Venmo app and a QR code
- 3.49% + $0.49 per transaction for purchases made online or in-app using the Braintree gateway or PayPal Checkout
You’ll notice this is quite a large difference in fees. Venmo’s rates are pretty good for in-person transactions but very high for online payments.
So why wouldn’t you just use your personal account for business transactions? For one, it violates your terms of usage and could result in having your account suspended. For another, the IRS has stated an intention to start cracking down on peer-to-peer platforms for tax evasion.
Venmo Business Profile Limits
Naturally, there are some Venmo business account limits on how much money you can send, receive, or transfer to your bank account.
Purchases have the following limits:
- $24,999.99 per week ($2,499.99 without identity verification)
- $2,999.99 per single transaction
Transfers to your personal bank account have the following limits:
- Up to $49,999.99 per week ($999.99 without identity verification)
- Up to $50,000 for instant transfers per transaction
How Do Venmo Business Accounts Work?
Let’s take a closer look at how Venmo business accounts work.
What Are Venmo Business Accounts?
Venmo Business Profiles allow you to make sales through your Venmo account. They also offer some sales and customer analytics information for your business transactions. Additionally, the service has a social function, providing you with some free advertising for your business to friends of your customers, who will see those transactions in their feeds.
Can You Have Venmo Personal & Business Accounts?
A Venmo Business Profile allows you to separate business and personal transactions within your Venmo account. Venmo strongly discourages using personal transactions for business reasons. Therefore, if you’re going to be using Venmo frequently for that purpose, you don’t want to risk having your account frozen or running into problems with the IRS. You can toggle between the two accounts after you’ve created them.
To create a Venmo Business Profile, you’ll need to be a US resident and have a Venmo personal account. You’ll also need to be incorporated as a sole proprietor to add a Business Profile to your personal Venmo account. Note that partnerships, LLCs, corporations, etc., can still use Venmo, but they’ll need to establish a separate Venmo business account.
Venmo Business VS Personal Accounts
A Venmo Business Profile allows you to send and receive business and personal transactions from within the same account while keeping those two categories separate for record-keeping purposes. There are a few additional restrictions to keep in mind, however. Here’s a summary of the key differences between a Venmo Business Profile and a vanilla Venmo personal account:
- Your Venmo account may be suspended or terminated for any reason
- Your Venmo Business Profile is subject to certain monthly transaction limits (see Venmo Business Profile Limits below)
- Your personal Venmo Debit Card transactions cannot be funded by using money in your Venmo Business Profile
- You will be solely responsible for calculating and paying all applicable sales taxes
- Venmo Business Profiles do not support recurring billing (although this feature is available through the Braintree payment gateway or PayPal Checkout)
How To Make A Venmo Business Profile
Creating a Venmo Business Profile for in-person transactions is about as simple as it gets. Just open the Venmo app on your smartphone or tablet and follow these steps:
- Select the Venmo app’s main menu (☰)
- Choose the Business Profile option
- Follow the steps provided and enter the appropriate information about your business
That’s it! The entire process can be completed in just a few minutes, after which you can begin accepting payments from your customers.
How To Accept Venmo Payments As A Small Business
Once you have a business profile, you can begin accepting Venmo payments for your small business. The biggest potential impediment here is that your customer needs a Venmo account. If they’re buying in-person, they’ll need to have a mobile device with the Venmo app installed.
There are a few ways to initiate a payment. You can:
- Request a payment from the customer through the app
- Have the customer look up your account
- Have the customer scan a QR code associated with your account
Of the three, the third option is probably the quickest.
Does Venmo Have A Card Reader?
Because Venmo payments use QR codes for in-person transactions, the company does not offer a Venmo card reader of any type. This includes both traditional countertop terminals and mobile card readers that connect to a smartphone or tablet.
What Venmo does offer is a QR Kit. For $14.99, Venmo will send you:
- A set of five stickers with your QR code on them
- A wallet card with QR code plus a lanyard
- A 2″ x 4″ x 6″ QR-code tabletop display with stand
Your customers can scan these with their mobile devices to initiate a payment. While Venmo doesn’t exactly have payment links in the common sense of the term, you can send your QR code by text or email.
Using Venmo Payments Without A Business Profile
It’s possible to integrate Venmo into a website checkout page using the Braintree gateway or PayPal Checkout. In addition to setting up a Venmo Business Profile following the steps outlined above, you’ll need to integrate the “Pay With Venmo” option into your existing website or app, using either the Braintree gateway or PayPal Checkout. Keep in mind that accepting Venmo payments over the internet negates the cost savings you’ll get with in-person transactions. You’ll be paying 3.49% + $0.49 per transaction.
Integrating Venmo into PayPal Checkout also requires a developer and some code work. PayPal Checkout now offers “smart” customizable payment buttons and contextual tools that will display multiple checkout options — PayPal, PayPal Credit, or Venmo — based on what it knows about a consumer. It’s also worth noting that PayPal Checkout doesn’t allow you to present Venmo as a standalone payment option. If you’d like this feature, you’ll need to go with Braintree instead.
Final Thoughts: Venmo For Business
For most merchants, deciding whether to take payments through Venmo will depend on the nature of your business and your customer demographics (especially since setting up automatic recurring payments through Venmo is currently not an option). Venmo Business Profiles work great for sole proprietors, including freelancers and other independent contractors. Larger businesses can also use Venmo effectively, but you should be aware of the transaction size and volume limits before relying too heavily on this payment method.
eCommerce merchants should also be cautious about using Venmo. While it’s a great way to add more payment methods to your site, it might not be a cost-effective option if you need to hire a developer to set it up for you.
In any event, Venmo For Business is a solid option for some business use. However, it should only be used as a secondary payment method, as you’ll still want to be able to accept traditional credit and debit cards as well. You might also want to check out our complete guide on Zelle for Business, which offers a similar alternate payment method. And if you’re interested in more of the PayPal ecosystem’s niche services, check out PayPal’s Pay in 4 option.