Venmo Hits You With 3% Fee
Using a credit card on Venmo can trigger a second fee of 3% to 5% from your issuer, doubling the cost
Venmo allows users to send payments and transfer money using credit cards, but charges a 3% fee on such transactions. This fee applies to all payments sent with a credit card, regardless of the card's rewards rate.
Some credit card issuers may also count peer-to-peer payments as a cash advance, which is typically subject to a fee of 3% to 5% of the transaction amount. This means that users could be charged two separate fees: the 3% Venmo fee and the cash advance fee from their credit card issuer.
However, Venmo does not charge a fee on certain purchases made with an authorized merchant. Authorized merchants on Venmo include Abercrombie & Fitch, CVS, Foot Locker, Hollister, Home Depot, Hulu, Grubhub, and Uber Eats.
Users can add a credit card to their Venmo account through the web app or mobile app. The process involves selecting the payment method, adding card details, and verifying the information.
It's worth noting that some credit cards, such as the Citi Double Cash Card and the Capital One Venture Rewards Credit Card, offer 2% rewards rates on all purchases. However, the 3% Venmo fee would still apply to payments sent with a credit card.
## Why it matters The fees associated with using a credit card on Venmo can add up quickly. Cash advances, in particular, can be costly, as they do not get the same grace period as purchases, and interest will start accruing at the higher rate immediately. Users should carefully consider the potential costs before using a credit card on Venmo.
