New VENMO fees. Did anyone else get this email today?

[bronk]

Venmo logo

We're reaching out to let you know that as of July 1, 2024, transaction fees for receiving payments tagged by the sender as a goods and services purchase will change to 2.99% per transaction.

This change won't affect fees for receiving payments into business or charity profiles, which remain at 1.9% + $0.10 for Venmo-to-Venmo transactions. View our fees. Eligible goods and services payments are covered by Venmo Purchase Protection.

[redir]

Got a couple days ago. Paypal owns Venmo. So much for free market choices.

[verticaldoug]

Venmo was bought by braintree which was bought by Paypal in 2013.

Although Paypal doesn't break out Venmo, you can back it out from transaction volumes. Venmo is about 17% of Paypal revenues, and probably contributes about 1 bln in ebitda to Paypal.

It's probably a pretty good deal for you from a service point of view.

[Nomadmax]

Nothing is "free".

[bronk]

Originally Posted by verticaldoug

It's probably a pretty good deal for you from a service point of view.

Not really. I receive thousands of dollars in rental income every month through venmo which will now cost me hundreds in fees. I'll be switching back to zelle.

[kppolich]

Just have the tenants not send it as goods and services and no fees.

[KonaSS]

Originally Posted by bronk

Not really. I receive thousands of dollars in rental income every month through venmo which will now cost me hundreds in fees. I'll be switching back to zelle.

Or require to be paid with checks.

[Alistair]

Originally Posted by bronk

Not really. I receive thousands of dollars in rental income every month through venmo which will now cost me hundreds in fees. I'll be switching back to zelle.

As a consumer, Zelle is awful. It's has the fewest protections (none, last I checked) for both sides of transactions of any of the major players.

[Alistair]

Originally Posted by bronk

Not really. I receive thousands of dollars in rental income every month through venmo which will now cost me hundreds in fees. I'll be switching back to zelle.

Transaction fees are part of doing business and should be baked into the rental rate. Short-term this stings, no doubt, but long term, relying on "free" online transactions in the US is a losing bet.

Tangential rant: The US is so far behind the EU on banking it's ridiculous. Free/low-cost moving of money between banks is usually trivial in the EU. In the US, it's a pain in the arse, so we rely on these 3rd party apps that have their priorities that aren't always in line with what we, the end consumer, need.

[bronk]

Originally Posted by Alistair

Transaction fees are part of doing business and should be baked into the rental rate. Short-term this stings, no doubt, but long term, relying on "free" online transactions in the US is a losing bet.

Tangential rant: The US is so far behind the EU on banking it's ridiculous. Free/low-cost moving of money between banks is usually trivial in the EU. In the US, it's a pain in the arse, so we rely on these 3rd party apps that have their priorities that aren't always in line with what we, the end consumer, need.

So, if I understand you correctly, you're saying the US is way behind the EU in making it easy for the consumer to freely transfer money. And, you're also telling me I should just accept this as a cost of doing business in the US despite there being ways to transfer money at zero cost. And, you're also saying I should be charging my renters more to cover the transaction cost even though they have been doing this freely for years and there are alternatives to Venmo that are still free in the US.

Gotcha. Thanks.

[Alistair]

Originally Posted by bronk

So, if I understand you correctly, you're saying the US is way behind the EU in making it easy for the consumer to freely transfer money. And, you're also telling me I should just accept this as a cost of doing business in the US despite there being ways to transfer money at zero cost. And, you're also saying I should be charging my renters more to cover the transaction cost even though they have been doing this freely for years and there are alternatives to Venmo that are still free in the US.

Gotcha. Thanks.

Yes to all of that.

In the EU, most banks allow free/low-cost and nearly frictionless exchange of money between accounts. From a consumer perspective, it's kind of like wiring money from bank to bank, but updated for this century. This is where we should strive to be in the US. Whatever costs are associated with that system are just baked into account maintenance fees or other user fees (you don't usually pay a per transaction fee, at least not that I recall).

In the US, banks, government, and other stakeholders have resisted adoption of modern banking processes. Many reasons why, some economic, some political, but whatever the case, we don't have what many consumers in the EU have.

So, we're stuck with Zelle (bank-operated, zero protections for either side of transactions) or Paypal/Venmo (3rd party, so have transaction fees for business use). Nobody should expect PayPal/Venmo to operate without a user fee - they aren't banks and need to make a profit.

Until we, as consumers (and voters), demand better, we're stuck paying PayPal to move money around (or deal in cash/check). That's a cost of doing business and should be wrapped into whatever fees a business charges (in your case, that's rent). Write your Congresspeople, call your local reps, reach out to your bank/CU, and vote.

[verticaldoug]

Originally Posted by bronk

So, if I understand you correctly, you're saying the US is way behind the EU in making it easy for the consumer to freely transfer money. And, you're also telling me I should just accept this as a cost of doing business in the US despite there being ways to transfer money at zero cost. And, you're also saying I should be charging my renters more to cover the transaction cost even though they have been doing this freely for years and there are alternatives to Venmo that are still free in the US.

Gotcha. Thanks.

Since I actually live in London most of the time, and bank in a few different countries with different rules, I'll clear up a few misconceptions.

There is no zero-cost way to transfer money. You may be charged zero, but somewhere someone is paying for the creation and upkeep of the service which is non-trivial.

The EU/UK were mandated to charge low fees for bank transfers per the EU regulations. SEPA (Single European Payment Area) mandated domestic fees and fees to other countries in the EU had to be the same.

The UK went one more step with BACS, CHAPS, FPS etc for payments between accounts. I can send money from my account at Barclays to my friends account in HSBC for zero fee. The bank just lost money.

In fact, the over regulated banking environment in Europe has basically made EU Banks pretty unprofitable since 2008. Barclays, Lloyds, Santander, Deutsche Bank, Socgen all trade between 5% (lloyds) to 30% (santan) of their 2008 highs. Barclays, Socgen and DB trade about 20% of 2008. Imagine if JP Morgan and Bank America traded $10 per share. That's a lot of economic activity not created.

There is no reason the US Gov cannot regulate banking as stringently as the EU, but then you start down the path of choking our economy. Since Brexit (2016) the UK has only grown about 5%, the EU less 4% and the US over 20%. I know which number I like. It's not that US Banks resisted change, they resist losing money. The EU mandated banks need to lose money on some business. It makes more less robust banking overall which is a drag on the economy. Venmo charging zero is like communism, doesn't work for long.

Venmo and Paypal probably just closed a well known loop hole where users were violating terms of service. If you were receiving rent, I thought it always needed to be a business account and pay a fee. When Venmo transfers money, someone along the line either sending or receiving is paying a small fee to PLAID.

I'm surprised you want to use Zelle or Venmo. Neither really have safeguards and aren't really integrated into anything. Isn't it better to use something like appFolio for the other services you can integrate it with?

[bronk]

Originally Posted by verticaldoug

I'm surprised you want to use Zelle or Venmo. Neither really have safeguards and aren't really integrated into anything. Isn't it better to use something like appFolio for the other services you can integrate it with?

I've been using Zelle and Venmo since I stopped accepting checks and have never had an issue. But, I've also had the same reliable renters for years. Never heard of appFolio but will look into it.

[verticaldoug]

Originally Posted by bronk

I've been using Zelle and Venmo since I stopped accepting checks and have never had an issue. But, I've also had the same reliable renters for years. Never heard of appFolio but will look into it.

Having the same reliable renters for years is awesome accomplishment. It keeps the mischief down. It seems you are in a relatively unique position of trust between yourself and the renters which is pretty rare these days.

[rice rocket]

Originally Posted by verticaldoug

In fact, the over regulated banking environment in Europe has basically made EU Banks pretty unprofitable since 2008. Barclays, Lloyds, Santander, Deutsche Bank, Socgen all trade between 5% (lloyds) to 30% (santan) of their 2008 highs. Barclays, Socgen and DB trade about 20% of 2008. Imagine if JP Morgan and Bank America traded $10 per share. That's a lot of economic activity not created.

Wow. False equivalency much?

Deutsche Bank has been the center of many scandals, not sure how EU regulation is making them unprofitable. They have generated enough profitability to stay afloat despite paying billions in fines over the last decade.

And I've had a Barclays credit account, they are woefully mismanaged. EU regulation have nothing to do with it from my perspective, more that they can't manage a basic credit product without getting the basics correct.