Paypal keeps adding additional payment methods to its repertoire over the past twelve months. Little under a year ago, the company mentioned how Bitcoin payments will be integrated through PayPal subsidiary BrainTree, although not much has happened ever since. Earlier today, an announcement was made regarding the integration of peer-to-peer payment platform Venmo.
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Venmo – A Rage Among Collegiate Americans
Peer-to-peer payment solutions have a certain appeal, regardless of what age the user is. There is no better feeling than being able to send money directly to other peers while using a convenient way to do so. Venmo checks all boxes in that regard as has gained a lot of traction over the past few years.
In more recent times, Venmo was acquired by BrainTree, a Paypal subsidiary. Putting two and two together, it only makes sense for PayPal to integrate Venmo payment support in an official capacity, as it is – technically speaking – one of their own platforms. That being said, there hasn’t been much profit made by Venmo, as the platform processes transaction free of charge unless a credit card is used.
With the upcoming integration, Venmo users will be able to use the mobile application wherever Paypal is accepted, both in online and offline fashion. However, there is some less good news too, as all Venmo transactions will become subject to the standard PayPal fees. It remains to be seen how the platform’s users will respond to this change.
Venmo has gone through an interesting growth spurt as of late, as the company was processing just shy of US$1bn worth of transactions per quarter 2014. But in Q2 of 2015, that number suddenly increased to US$1.6, and that trend continued through Q3, resulting is US$2.1bn worth of transactions.
According to PayPal, Venmo has become one of the fastest-growing companies in the payments space. Assuming the company is successful in retaining existing Venmo customers after changing the fee structure, there is a lot of money to be made. Additionally, the growth of consumers relying on mobile phones to make payments will be a new customer base to tap into.
The Rise of Peer-to-peer Payment Solutions
Even online payment giants like PayPal are starting to realize just relying on credit and debit cards, as well as bank accounts, is no longer a viable business model. Consumers want access to hassle-free payment solutions, and the peer-to-peer aspect is becoming one of the top priorities to achieve that goal.
Venmo and Bitcoin are two of the most promising peer-to-peer payment solutions in existence today. Despite BrainTree announcing Bitcoin integration quite some time ago, it is still up to individual PayPal users to enable digital currency payments through the platform. Whether or not this will be the same for Venmo, is unknown at this time.
What are your thoughts on Venmo integration? Have you ever used this peer-to-peer payment service? Let us know in the comments below!
Source: The Verge
Images courtesy of PayPal, Venmo, Shutterstock