Venmo help?

September 2, 2019 12:07 PM

My roommate wants me to use Venmo to pay them back. A) is it more secure to connect a bank account or a credit card? B) if I only connect a card will it charge me extra fees? PayPal charges lots of fees for transferring money because I only have a debit card connected.
posted by azalea_chant to Work & Money (9 answers total)

I think credit card is prob more secure -- I imagine it'd be easier to recover money (fraud claim?) if someone were to access your account. When Im forced to use Venmo, I usually connect my account info, transfer, and then quickly disconnect my card and delete my info once the transfer posts. Not sure how effective a safeguard but just gives me peace of mind.
posted by shaademaan at 12:58 PM on September 2, 2019

1) I can't comment on the specific security with venmo, but typically credit cards are safer as they would not force you to pay a fraudulent charge the way a bank account/debit card would at first (though a bank/debit card would eventually refund you, you'd still be on the hook for the missing money until that occurs). However, for 2) if you connect a credit card, they will charge you a 3% fee on each transaction. If you connect a debit card, there is no fee - it functions just like if you had connected the bank account that the debit card is attached to. Between a bank account/debit card, I would recommend a debit card, as a debit card number can be cancelled more easily if there is fraud.

I personally don't have any security concerns with Venmo - they are owned by Paypal so it's not exactly a fly by night operation. The main concern would be the usuals with this kind of thing, if you have an insecure password/not using two-factor authentication where someone could log into your account. shaademaan's practice would probably be a good safeguard against that in case there is some kind of an account breach.
posted by jouir at 3:02 PM on September 2, 2019

According to the Interweebs, Venmo waives the fee if you do transactions with bank account, debit card, or balance in Venmo.

Personally, I'd rather chew broken glass than to give PayPal/Venmo my banking information, but your mileage may vary.

As jouir noted, you have more protections with a credit card. So in that sense, it's "safer" to use a credit card than a bank account.

I grudgingly use PayPal for some transactions (mostly buying vinyl and CDs off Discogs) but refuse to use Venmo because they force users to install a mobile app now. So, in your shoes I'd be telling my roommate to pick a different and less intrusive option.
posted by jzb at 4:02 PM on September 2, 2019 [7 favorites]

The thing about something like Paypal and Venmo by association is that you should almost certainly not let them hold your money for extended periods; Paypal has proven unreliable enough about freezing access to account balances for that to be a predictable problem. I'd go with the debit card because, yeah, there's no fees on that and it's something that you can more easily cancel in event of a breach.

However: I'd use the debit card with Venmo because it doesn't cost more, but I have a bank account hooked up to Paypal and I'm not losing sleep over it, and it renders a lot of things less costly. I am a software developer; I don't believe any of these things are completely safe. I just think that the risk as compared to the amount I'm going to lose in the event of a breach is not comparable to what I'd pay to use Paypal without a linked bank account.

If you're concerned about somebody getting into your bank account from Paypal, you should probably be concerned about them getting into it in general, and take preventative measures accordingly: keep some cash in your home and on your person, have a backup credit card account if you can, and keep an eye on the activity of all your bank and card accounts on a regular basis. And know what your bank's policies and reputation are about handling of fraud incidents. You're almost certainly doing a lot of stuff already that's higher risk than Paypal and Venmo.
posted by Sequence at 6:07 PM on September 2, 2019

Another alternative is Zelle, which is built into many banking apps. Several major banks use it (I have BofA, fiancee has TD North, and we send money to each other all the time). While I've used Venmo for small, one-off transactions (group lunch or coffee orders, for example), I vastly prefer using Zelle for transferring larger, more formal transactions, such as rent. Hope this helps!
posted by katemcd at 6:50 PM on September 2, 2019 [1 favorite]

I'd also try using $CashApp. Used it for many transactions between friends, and haven't had an issue yet.
posted by dubious_dude at 7:08 PM on September 2, 2019

@katemcd from a safety/security perspective, I've read zelle is as bad as Venmo if that's a concern. Several people on reddits /r/personalfinance for e.g. have had money stolen from bank accounts after using Zelle.
posted by shaademaan at 7:53 PM on September 2, 2019 [1 favorite]

As retro and analog as it may sound, you could always just write your roommate a check. No security issues whatsoever. Depending on your bank or credit union there may be no fees. Credit unions are more likely to have reduced or no fees, especially if you are a student.
posted by citygirl at 7:51 AM on September 3, 2019 [2 favorites]

Um, I'm going to push back on the fact that checks have "no security issues whatsoever." That's patently false. If you're deleting your bank info from venmo each time, consider the fact that a check literally means handing someone a piece of paper with your bank account number (and address, probably) printed on it.

Venmo is a way that people pay roommates every day; with basic precautions in place (especially checking to ensure that you're sending money to the right person), it's not worth stressing about.
posted by mosst at 2:51 PM on September 3, 2019 [2 favorites]