Learn all about exchanging currency in Salt Lake City
For many of the money transfer services out there, there isn’t much focus on the purpose for the account creation. Therefore, they tend not to have so many features or functionality that is offered for a specific use case. This is where Venmo stands out.
The platform goes beyond its social network features that complement person-to-person transfers. Venmo offers accounts to be used particularly for running a business. We’re going to break down the details of using Venmo for business, the fees involved, and the benefits of having alternatives, like Wise.
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On top of the usual personal profile, Venmo enables users to create business profiles that can be accessed through the same login. The business profile enables you to accept payments for your business, giving users an easier checkout experience while also helping you get your business noticed¹.
This is partly because customers can share what they bought from you and it’ll appear in their feeds. Additionally, you can monitor your personal and business transactions separately to get a clear picture of how your business is doing(See Venmo Alternatives).
Besides this, you can analyze the behavior and other information regarding customers to learn more about who’s supporting you the most, how many share the payments, the impact that these posts have, etc. This insight can help you plan better and know where to focus your efforts.
Customers can also pay for your goods and services in a touch free manner thanks to QR codes.
To be eligible for a Venmo business profile, you need to be an individual with a personal Venmo account, a sole owner or have the business profile representing a registered business.
In order to have a business account, you need to sign up for a personal account too. You should know that Venmo allows you to set up both a personal and business profile in the same process, which is broken down below²:
- Once you have downloaded the app, choose the Business option
- Hit the Sign Up button
- Next, you’ll select Get Started
- Type in your name, email address and your desired password
- Tap the Agree button then enter your mobile phone number, after which you’ll hit Send Code
You will receive a four-digit code which you enter into the app then select Submit Code. With a successful verification process, your business profile will have been created. In case your number isn’t verified, you’ll get another chance. You can also skip the business profile and just complete the personal profile set up.
If your phone verification is successful, you’ll be asked for details about your business such as:
- Whether your business uses an Employer Identification Number (EIN) or not
- Your business’ display and username, category, and a short description
- Your business’ address
- An address, phone number and social media page through which customers can reach you (these are not a must)
You’ll now be able to preview your business profile to know how it’ll look in customers’ eyes, then you can publish it and also enter the name for your related personal profile. You can switch between your personal account and business profile by tapping on your photo in the top-left corner of the app².
If you already have a personal Venmo account, here’s how you can go about setting up a business profile:
- If you’re eligible for a business profile, you can tap on your photo in the top-left corner or the menu button (the one with three horizontal lines) at the top of the app, then open settings
- From here, follow the same steps mentioned above
As we mentioned earlier, you can set up your business profile as a sole owner or a registered business. If you set it up as a sole owner, any payment method you link to your personal account will also be linked to your business profile. But if you set it up as a registered business, these payment methods will be kept separate.
This can help you to avoid mixing your personal and business transactions, which can create more work for you when you’re balancing your books. To add a payment method to your business profile, follow these steps:
- Go to your business profile and tap the menu icon at the top of the app
- Proceed to Settings
- Tap Payment Methods
- Select Add bank or card
At this point, you can add a bank account, a debit or credit card. The bank account can be added by using your credentials or typing in your account and routing number. Make sure that you do not enter your check number if you are entering your details manually.
This method involves Venmo sending microtransfers to your account to verify the information you have submitted so ensure that you have at least 2 USD in your bank account to avoid possible overdraft fees³.
|For more detailed information check How to add money to Venmo
Venmo also gives you the option to receive tips from your customers. Simply go to your business profile’s settings and tap the Tipping option. If your business profile hasn’t received any money yet, you can find this feature in the What’s Next section on your business profile’s homepage.
For in-person payments, Venmo allows a customer to find your business by scanning your QR code. You can get your QR code by tapping Scan at the bottom of the app and selecting My Code. This code can be shared via email, text message and even printed out⁴.
Venmo even allows you to take it a step further by creating a unique QR code that takes your customers to your business profile and has an already set price for a transaction. To create one of these:
- Tap the Scan button
- Continue to your business profile’s QR code by selecting Venmo Me
- Hit the $ button
You’ll now be able to enter a particular USD amount and tap Set Amount. Whenever a customer scans this code, they’ll end up on your business profile. As they start the process of making a payment to you, the price you set for that QR code will be pre-filled⁴.
With the Venmo personal account, you are limited to peer-to-peer transactions and buying from authorized business profiles.
This means you can pay a friend the money you owe them or buy from a business. You can also use the Venmo Debit Card to pay for goods at merchants which accept it as a form of payment.
What you can’t do with the personal account is accept payment for the transfer of goods or services.⁵
The moment you want to accept payments for transactions, you’ll need to set up a Venmo business account profile.
The main reason why businesses can’t use Venmo personal is that it isn’t permitted. Venmo states that the personal account is for peer-to-peer payments and purchasing from authorized business profiles, nothing more.⁵
A business can’t use a personal account because it doesn’t provide the necessary tax records. Plus, since customer information is visible with personal payments, this could raise concerns over privacy.
As such, the personal account on Venmo just isn’t suitable for business transactions. As a peer-to-peer payment account, there is little to no customer protection, which can cause headaches over issues like refunds.
Venmo charges fees on seller transactions so as to keep improving the service they provide, as well as helping Venmo to provide other business-specific features like tax reporting, enhanced payments, and disputes services. The business profile fees also follow the relevant industry standards.⁶
A small fee is charged on every payment made to your business. This seller transaction fee is 1.9% of the payment plus 0.10 USD. Therefore, if someone pays your business 100 USD, you will receive 98 USD. This is because the subtracted amount is (1.9% X 100) + 0.1 = $2.
Keep in mind that you can not get this fee back from Venmo. It’s also important to check with your card provider so that you can know about any additional charges for receiving money from Venmo users. You should remember that Venmo offers a free 30-day trial period for a business profile.
This means that during the first 30 days of having your business profile up and running, you will not be charged a seller transaction fee for any payments made to your business.⁶
One of the payment solutions that can make a fair substitute for Venmo for Business is Wise. Let’s take a closer look at the Wise Business account and what it offers. The Wise Business account enables you to do business internationally with a number of features such as:
|You can pay invoices at the true exchange rate in over 70 countries in just a few clicks. As much as 50% of these payments are instant or arrive within one hour. The recipient doesn’t even need to have a Wise account. All you have to do is enter their bank details or email.
|Wise enables you to speed up the process of handling international payroll, repaying employees and making repeat payments. The batch payments feature enables you to pay as many as 1000 people in one click. All you have to do is upload a spreadsheet with details for each transfer and make one payment. You can even save all the previous payment information and add team members to the account so they can use it in the future to help you shorten the whole process.
|Multi-currency account details
|This feature allows you to get the account details you need to send and receive money in another currency without being located abroad. Basically, you can always be ready with your IBAN or wire number when a client asks for it. All this is protected by end-to-end encryption and funds are held with top institutions across the world.
|You are able to receive money in various currencies without being charged high recipient or conversion fees.
All-in-all, Venmo for Business offers a simple and friendly experience for receiving payments to your business. It also comes with some ingenious additions like tax reporting, disputes services and preset price QR codes.
However, if you want to do business on a global scale, you need a solution like Wise, which goes beyond the payment itself. It's a great alternative as it comes with support features that address the day-to-day managerial details surrounding international business payments.
- Venmo - Business profiles
- Venmo - How to sign up for a business profile
- Venmo - Business profile payment methods
- Venmo - Business profile payments QR code, bank transfers and statements
- Can I use Venmo to buy or sell merchandise, goods, or services? – Venmo
- Venmo - Business profile fees
Sources checked on 06.30.2021
This publication is provided for general information purposes and does not constitute legal, tax or other professional advice from Wise Payments Limited or its subsidiaries and its affiliates, and it is not intended as a substitute for obtaining advice from a financial advisor or any other professional.
We make no representations, warranties or guarantees, whether expressed or implied, that the content in the publication is accurate, complete or up to date.
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