In our Contactless Payment 101 series, we’re breaking down the basics of processing transactions hands-free. Today, we’re talking Venmo payments.

Let’s be real: accepting payments as a small business owner can get a little murky. 

There are the various fees for different cards, Square here, Stripe there, (and, if you’re in the know, Schedulicity Pay, too) and the one 70-something client who still writes you a check after every hair appointment.  And then, there’s Venmo

You likely use Venmo for personal financial transactions, i.e. sending friends and family money. But some service providers also use Venmo to accept payments for appointments or sessions.

Using Venmo for your business transactions might seem like a great idea — especially because it’s a contactless way to accept payment in the midst of this pandemic — but here are a few reasons why we don’t recommend it. We’ll also cover what you should do instead.  

Why You Shouldn’t Use Venmo for Business Payments

Venmo Prohibits It (With Two Exceptions) 

Let’s just get this out of the way before digging in: Venmo explicitly states on its site that you should not use it for business payments.

In response to the question, “Can I use Venmo to buy or sell merchandise, goods, or services?”, the team states: 

Venmo may NOT otherwise be used to receive business, commercial or merchant transactions, meaning you CANNOT use Venmo to accept payment from (or send payment to) another user for a good or service, unless explicitly authorized by Venmo.  

Unlike other payment processors, Venmo doesn’t charge a processing fee (because it’s meant for sending money between friends). This can make it — ahem — very tempting to use for small business transactions, but it’s not OK with the company. 

The Two Exceptions

That said, Venmo has recently been expanding into the world of payment processing for businesses. You can use Venmo as a payment method for your business through PayPal and/or Braintree. Beyond that, Venmo for business still leaves a lot to be desired — though rumor has it that it has plans for expanding (in July, Venmo announced “business profiles” — a “limited pilot” of tools for small businesses).

Venmo Was Built for Personal Transactions

Let’s just say we leave aside the explicit rules against Venmo for business, and let’s just say you’re thinking, “Yeah, but like…is it that bad to use it for business?” (Of course, you would never think this! We would never assume you would! We just love hypotheticals.) There are still some other issues to consider, including the fact that Venmo doesn’t offer the features of a standard payment processing system for businesses. 

Venmo was built for sending money between friends and family — you know, all those tabs you used to split back when we could all go out to happy hour. That means that it offer bare bones functionality for sending and receiving funds. The records are not made for filing taxes. Monthly reports don’t exist. A client cant just hit an “add 20% tip” option. That means more manual work for you and more risk of making mistakes. 

There Are Privacy Concerns

Ever figured out an ex had a new girlfriend based on who he was paying back in your Venmo feed? (This really can’t just be me.) When a customer or client pays you through Venmo, if they don’t mark the interaction as private, their entire network sees the transaction. That’s fine, for the most part, but what if they don’t want people to know they’re sneaking off for a massage or haircu on a Tuesday afternoon? 

Venmo Is About Trust, Which Isn’t the Ideal Way to Process a Payment Between Strangers 

Once someone sends you money via Venmo, that’s it. *Poof.* We know you’re honest and would refund a client if they accidentally overpaid you, but it’s a lot to ask of new clients or customers to trust you already — do you really want to ask them to send you money with no guarantees? 

The Payment Processors You Should Use Instead of Venmo

If you’re considering accepting Venmo payments because you’re looking for an affordable way to process credit cards — or to go fully contactless with your payments — there are several other options available to you that are made specifically for small businesses. 

Any Standard Credit Card Payment Processor

From Square to Stripe, there are plenty of them out there. Fees vary depending on which you choose and the type of transaction (here’s a handy payment processor comparison chart), and yes, you’ll ultimately pay more money to process your business transactions than under-the-table Venmo payments, but you’ll also do it the right and safe way. 


If you’re really hooked on the idea of offering Venmo payments to clients, then sure, PayPal is a good option for you. With Venmo payments built in, PayPal allows you to have it both ways — for a fee, of course. 

Schedulicity Pay 

Yeah, OK, we’re biased. But look, we built Schedulicity Pay for service providers and small business owners specifically so we could offer lower rates than the big guys.  We’re talking 1.99% + $0.10 for credit card dips, swipes, or taps. 2.85% + $0.10 for e-commerce or keyed-in transactions. (By comparison, PayPal runs between about 2.7%-2.9%, which also appliese when you’re using it to accept Venmo payments.)

We know that saving a few dollars here and a few more there adds up. So we thought a lot about how to make a credit card payment processor that would work for you. 

Final Takeaway

As the company expands its small business offerings, you might find it’s another viable option for you. Until then, Venmo is incredible, but use it for personal transactions and not business payments.