Should You be Ditching Venmo For Facebook’s New Payment System?

venmo vs facebook messenger

Photo: Imaxtree

Thanks to Venmo, it’s more important to bring your phone to a group dinner than your wallet. Anyone who’s used the money-sharing app knows it makes splitting bills, buying group gifts, and going on trips with friends that much easier. Rather than using internet banking or signing into PayPal, you can transfer cash to your friends with just their email address or phone number.

Facebook knows how much you love Venmo, which is why the social media giant launched its own payment system yesterday, allowing transfers to be made easily through Facebook Messenger. It will be rolled out across the U.S. in coming months.

MORE: 10 Money-Saving Tips From Women Working in Finance

Both Venmo and Facebook’s friend-to-friend systems are similar, to be sure, but different enough that you should consider both options and pick the one that suits your budget and lifestyle. Below, we break down the differences and similarities to help you choose which one’s right for you.

Fees; Debit Card vs. Credit Card
Like Venmo, Facebook requires your bank card information. You simply tap the “$” button in your Facebook Messenger, and send money to friends without any fees. But, if you’re the kind of girl who often relies on your credit card (no judgement), you’re probably going to want to stick with Venmo. In an effort to keep their payment function free, Facebook will only let you use a debit card for payments, while Venmo lets you pay with credit card for a 3% fee.

Privacy
Then, there’s the issue of privacy: Scrolling through your Venmo feed allows you to see what your friends have been up to with their cash—a guilty pleasure for many—but Facebook’s feature isn’t as voyeuristic. Because payments happen within private Facebook messages, you won’t be able to see who went dutch on a date over the weekend. We’ll let you decide whether that’s a good or a bad thing.

venmo vs facebook payment

Photo: Venmo

Convenience
Even if you don’t use Facebook as often as you used to, chances are you still often rely on Facebook Messenger for group conversations when it comes to planning an event. This is where the convenience factor comes in–it’s easier to just send someone money through the Facebook app you’re already using, than to open up Venmo and start fresh.

Another way Facebook is easier: If you already have a debit card on file with Facebook from previous transactions–whether it was gaming, ads or donations–you can simply use that to make Facebook friend-to-friend payments, too.

Security
Security is something else you really need to think about when it comes to transferring money online. Facebook’s service includes security-adding functions that prompt users to enter an in-app payment passcode or Apple TouchID fingerprint to confirm transfers, though you can opt out of this extra step in the settings if you want.

Venmo is a little less stringent–once you’re logged into the app, you can use it to transfer money without reentering your password. This could be dangerous if you often lose your phone or leave it unlocked. If you do leave your phone on the subway, and you’re worried about someone using your Venmo account, change your account settings online to revoke access on your phone.

Transfer time
Through Facebook, the money is instantly taken from one debit account and delivered to the recipient’s debit account, sending both parties a confirmation message with the transfer info. Facebook won’t hold onto the money, but it’s likely the banks will need a few days to process the transaction, so it could take a bit of time. On the other hand, Venmo transactions will appear in each party’s Venmo account instantly, and you can move cash from Venmo to your bank account in one business day in most instances. If you don’t move money from you Venmo balance to your bank, you can just use that Venmo balance next time you want to send someone money, rather than dipping into your bank account.

Still not sure? Watch this quick demo to learn more about Facebook’s new feature:

 

What do you think: Will you be switching from Venmo to Facebook’s new friend-to-friend payment system? Let us know in the comments. 

share