Apps for sending and receiving money make the process simple, but is it secure? That might be the most crucial query you have regarding the use of this money transfer app. Understanding Venmo’s security features and how they work is beneficial if you want financial security.
Describe the app:
Venmo is an app that lets you send money to friends and family instantly with a debit card or bank account. It’s a social network for money. You can use it to pay your friends back for dinner, split the cost of a new pair of shoes, or send money to your parents for rent.
The app has been downloaded more than 19 million times and has facilitated $6 billion in transactions so far.
When PayPal bought Venmo in 2018, it became the largest mobile payments company globally with over 150 million active users on its platform in 40 countries worldwide.
The company’s primary focus is on helping people manage their finances while they are away from home or at work; this includes paying rent, bills, meals at restaurants and more.
How Does Venmo work?
Users of the Venmo app can send money to pay bills or receive money by “requesting” it by linking the app to a bank account (checking or savings) or credit or debit card. Although it’s most frequently used among friends and family members, many merchants also accept it.
When you want to pay someone for the concert tickets they gave you as a gift or charge them for their share of your dinner bill, the Venmo platform is useful. You can use Venmo to send someone a birthday surprise or to pay for services like babysitting or housecleaning as long as the other person has a Venmo account.
However, since the Venmo transaction occurs between the two participating banks, no money exchanges hands. Let’s say you and a share split a $25 dinner tab. Sending your friend $25 via Venmo will immediately send his balance by $25 while decreasing yours by $25. You can either transfer money to your bank or leave those funds in your Venmo account for future transactions. Imagine it as a ledger that records the money that comes in and goes out as a result of your use of the app.
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Download the app, then use the app’s instructions to link it to your bank account or credit card to start using Venmo. You can conveniently make purchases from your mobile device once it is integrated into your “mobile wallet.”
Due to the bit that it functions somewhat like its own social media platform, Venmo also has a fun side. You can send your friend $25 along with an emoji of a burger or a salad to add to the dinner tab. In your “activity” feed, you can see what your friends sent or paid and other exchanges from people you know. (Be ready to experience some FOMO, or fear of missing out, when you notice that a group of people grabbed pizza without you.) If you don’t want other people to make who you’ve paid and for what, you can also set those settings to “private.”
Although you can pay anyone with Venmo, even if they are not your “friend,” you can add friends to your Venmo app to ensure you’re paying the right person for your purchase. However, always double-check to who you are sending money when you make a transaction; if you send it to the incorrect “Susie Robinson,” Venmo won’t reimburse you. It’s a good idea to add a photo to your profile so that your friends can be sure they are matching with the right person.
How safe is Venmo?
Your bank account and/or credit card accounts are connected to your Venmo account. This allows you to send and receive money from friends, family members, and other app users. The Venmo platform processes transactions between users who are sending and receiving money using an application programming interface (API).
The company’s website states that to secure and protect its users’ personal and financial data, Venmo employs encryption protocols. Venmo, a popular mobile wallet app, has been struggling with security concerns. It was recently hacked, and the company has been forced to change its language about security.
Venmo is a popular mobile wallet app that allows users to send money through contactless payment methods like their debit cards or bank accounts. The company’s website states that it offers “bank-grade” security measures for its users. However, this language was taken down from the website after it was hacked in September 2018.
Note: A common Venmo scam involves someone funding a payment with a stolen credit or debit card or someone falsely disputing a payment after you’ve sent them money.
It appears that Venmo is safe at first glance. It’s not perfect though. If you haven’t set multifactor authentication and someone were to transfer your PIN or account login information, they might be able to use the app to fraudulently withdraw money from your bank account.
Can I connect my bank account to Venmo?
According to Venmo, encryption is used to protect your transactions and account information.
3 Enabling multifactor authentication also allows you to increase security. However, you can link Venmo to a credit card rather than your bank account if you’re still concerned about security (preferably with no fraud liability).
How much cash can I safely store on Venmo?
You can maintain a balance on the Venmo app, but it’s usually good money to transfer your funds to your bank account. The funds in your Venmo account are not FDIC-insured unless they were deposited by a direct money transfer, remote check capture, or the money of cryptocurrency.
How Can I make My Venmo?
By setting up multifactor authentication and entering a PIN code, the app enables you to add layer of security. When a PIN is enabled, the user must enter the code each time the app is opened in order to access it. If your device has fingerprint recognition, you can combine a PIN code with it.
Two-step multifactor authentication requires a special code in order to access your account. Venmo accomplishes this by sending you a special code via text or email, which you must enter in order to log in.
You can lock your Venmo account from your phone if you misplace it or believe someone is trying to access it. From a laptop or other mobile device, you can access your Venmo settings and delete the session connected to your phone. This automatically logs out of the app on your device.
Due to Venmo’s social-sharing features, you may unintentionally disclose payments, recipients, and payment reasons to anyone online.
Note: In order to make sure that you are in charge of payment visibility, check your default privacy settings.
How To Use Venmo Without Losing Money
When sending and receiving money through Venmo or another money transfer app, you can do a few things to increase your security. Use these pointers to protect your account and yourself.
Select a Special Password
Avoid using passwords that are likely to be easy to guess when setting your Venmo account password. Include both capital and lowercase letters, numbers, and unique symbols. Consider using a distinctive and uncommon acronym or phrase as opposed to a complete word to make it more difficult for hackers to identify you. A password manager could be useful.
Enable Multifactor Authentication and PIN Protection.
Your Venmo account can be protected in the event that your mobile device is lost or stolen by taking either of these two easy steps. They each take just a few minutes to complete. Additionally, set up a password or lock for your phone if you don’t already have one.
Connect Credit Cards Only, Not Debit Cards
You can use Venmo to link debit and credit cards to your account as payment options. You should use a credit card instead of a debit card for security reasons because credit cards have more legal safeguards against fraud than debit cards do.
Note: A 3% fee plus a potential cash-advance fee from your issuer are added when using a credit card to make a purchase.
Deal Only With Reliable Payers and Payees
Venmo advises users to only send and receive money from friends and family they know and trust, even though this should go without saying.
Transactions that involve accepting or sending payment from an unknown party may be much riskier. The Wall Street Journal reported that fake payment transactions processed through the Venmo app cost the company $40 million in the first three months of 2018. The Journal obtained and reviewed internal documents from PayPal, the parent company of Venmo. If you’re concerned about fraud, you can reverse payments made to new Venmo users who don’t yet have active accounts.
Watch the activity of your Venmo account by using push notifications.
You can monitor your account and when money moves in or out by setting up alerts. In “Settings,” click “Notifications.” In addition to payments and charges, email notifications will notify you of login attempts. Payments received and sent can be notified via push and text.
Do not use public WiFi
Make sure you use a secured Wi-Fi network when using Venmo to send or receive money if you’re not at home.
Using unprotected public Wi-Fi could expose your account information to hackers if they break into the network.
Avoid Remaining Logged In
It can be difficult to remember to log out of Venmo after each session, but doing so will end your session and lessen the likelihood that someone will be able to steal your information. Go to “Settings” in the app and then “Sign Out.”
Note: Someone might ask to use your phone in a scam related to this, and while you’re not looking, they might open your Venmo and transfer money to themselves. 7
Conclusion
Although Venmo is generally safe, there is always a chance when sending money electronically. By being aware of potential security odds and taking precautions to stay safe, you can reduce the likelihood that you will protect money using Venmo or another financial app.
