Venmo has become a popular peer-to-peer (P2P) payment app to send and receive money, which is owed to the growing number of digital natives who prefer contactless payment methods. But the function of Venmo does not end with transactions between friends and family as it also extends to business-to-customer (B2C) transactions. So, while you can set up a Venmo business account, let’s explore some usecases of Venmo for business owners.
An Overview Of Using Venmo For Business Transactions
Venmo has transcended the regular function of facilitating transfers between friends and family to becoming a mobile payment app for small businesses. Hence powering remote and in-person sales for business owners.
Therefore, you can direct potential customers to your profile by sending them your Venmo profile or by having them scan your QR. You can also request cash directly from your customer, much like an invoice. Overall, customers can pay you with a few taps on Venmo.
Usecases Of Venmo For Business Owners
1. Website Integration
There are odds that you have seen a PayPal payment option at checkout when you want to purchase anything online. So Venmo (owned by PayPal) can also be used as an online payment solution to complete purchases on your website.
It is easy to integrate Venmo with e-commerce platforms, making it a great way for business owners to drive sales online. Your customers will be redirected to their Venmo app for payment, which is considered fast and convenient. As such, the platform offers familiar and easy-to-use payment methods.
2. Effortless Marketing
When customers complete purchases using Venmo, their friends’ networks can see the sale, which automatically makes them brand ambassadors for your business. This is a form of free marketing of the products or services that your business offers, such that potential customers can easily access and convert sales for your business.
Therefore, every time a customer pays you on Venmo, all their friends and followings will know they support your business – except their settings are private. This is a digital word of mouth, which study has reportedly shown is the way to attract new customers.
3. Connection To Customers
The comment and “like” features on Venmo give business owners leverage to engage with their customers. As this is a social-style platform, you can always interact with customers and encourage them to patronize your business.
This gives a feeling of social media marketing on platforms like Facebook and Instagram, where customers can feel comfortable asking questions with the possibility of purchasing from you again.
4. Security
Venmo takes security serious as seriously as PayPal. While customers can use Venmo without a bank account, it is a safe and secure payment method due to an encryption system that protects users and their sensitive data. The platform also enables business owners to add an extra layer of security to their Venmo accounts by enabling two-factor authentication (2FA) and PIN.
Therefore, there are different security features that protect business owners from common Venmo scams that put them at a loss.
5. Tax Reporting
Businesses on Venmo are mandated by the Internal Revenue Service (IRS) to report their tax. So, if you earn $5,000 or more in a given year, Venmo will send you a 1099-K form at tax time. This makes it a little easier to report your business income instead of tracking every transaction to calculate your income tax.
Frequently Asked Questions (FAQs) About Usecases Of Venmo For Business Owners
Can I Use Venmo For Small Business?
You can use Venmo for small businesses as well as large businesses. It is free and simple to set up your business profile, which makes it more accessible.
Is It Smart To Use Venmo For Business?
If a Venmo business account is a good fit for your needs and budget, then it is a smart decision. But if there are other needs like processing card payments in person, you may need to consider another payment processor.
Can Sole Proprietors Or Independent Contractors Use Venmo For Business?
Any business entity type can use Venmo to accept online and mobile payments.
Conclusion
People continue to be drawn to Venmo as both individuals and business entities can use it for different transactions. But there are many reasons why businesses can use Venmo, which we have highlighted in this article.
However, it is essential to be cautious when using Venmo because it is a P2P platform that has an inherent risk of scammers lurking on the platform.
