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Venmo debit card: Is it right for you?

Since its launch in 2009, Venmo has become one of the most popular mobile payment apps in the United States. The app — which allows users to pay each other with credit cards, debit cards, bank accounts or linked account balances — began offering Mastercard debit cards in 2018, now known as Venmo Debit Cards.

The Venmo Debit Card: Is it right for you?
The Venmo Debit Card: Is it right for you?

Unlike traditional debit cards taken from linked bank accounts, the purchases you make using a Venmo Debit Card are counted toward your account balance (although you still need to have a linked bank account to transfer money to the said balance).

Issued by Bancorp Bank, Venmo Debit Cards allow you to withdraw cash from ATMs, and you’re not charged for withdrawing money at a MoneyPass® ATM in ATMs outside the U.S. MoneyPass network that charges $2.50 per withdrawal.

Get your money back with Venmo Rewards

Venmo Rewards, the official rewards program for Venmo Debit Cards, launched in October 2019. With the help of Dosh — the third-party cashback platform that manages Venmo Rewards — Venmo Debit Cards offer instant refund rewards when making card purchases at participating merchants. Whenever you make a qualifying purchase, your rewards will automatically be deposited into your Venmo balance.

Seller offers are available for a limited time, and you can view them in the Venmo app. Unfortunately, there’s no way to see these offers unless you have a Venmo Debit Card. The amount of refund varies with each offer and there may be a limit to the amount of refund you can earn. In the past, Venmo has offered 5% refunds for purchases at locations like Target, Wendy’s, and Sephora.

Security measures for Venmo Debit Cards

In the Mastercard network, purchases made with a Venmo Debit Card are protected by not being legally responsible, meaning you won’t be held liable for unauthorized transactions. With Mastercard Global Service, you can report lost or stolen cards and receive an emergency replacement card. Mastercard ID Theft Protection will monitor your credit file and alert you to suspicious activity as long as you activate it. And if you lose the card and then find it, you can also disable or activate your card in the Venmo app.

Venmo also offers a range of protections of its own. Under the Protected Purchase Plan, purchases made at authorized sellers using a fully covered Venmo Debit Card (plus shipping costs) under certain circumstances, including if you don’t receive the item or if the item doesn’t match the original description.

How to compare Venmo Debit Cards with competitors

Venmo debit cards aren’t the only debit cards that offer rewards to users when they spend. For example, there is a CashBack Debit for Discover, which earns 1% cash on purchases of up to $3,000 per month. Then Venmo’s competitor, The Cash App (formerly Square Cash), issued a Visa debit card, a Cash Card, in May 2017 — just over a year before Venmo’s release.

The Cash app’s withdrawal card is tied to the user’s balance and also offers a rewards program. Previously, cash card rewards were unofficially reported to include 10% cashback at Whole Foods, Burger King, Petco, etc.

Both Venmo and the Cash App set card usage limits. Venmo debit cards have a daily purchase limit of $3,000, which is significantly lower than the Cash Card’s $7,000 per day limit. Other terms apply.

Is venmo debit card valid?

If your main goal is to earn rewards for your purchases, reward credit cards may be more suited to your needs. Most rewarded credit card options, including those with no annual fees, provide advance information about how and where you can earn rewards, meaning you can choose a card based on how and where you spend.

It should be noted that Venmo Debit Cards cannot be used outside the U.S. or for online purchases with international sellers. Those who are interested in Venmo Debit Cards but regularly travel abroad, should make sure alternative payment options are available.

Even if you’re a regular user of Venmo, venmo debit card reward potential isn’t much compared to a reward credit card. It should be noted that Venmo also offers Venmo Credit Card, a co-branded credit card with Synchrony Bank, which is free annually and offers a higher rate of cashback when purchasing certain categories. With Venmo Credit Card, you’ll offer a 3% cash refund for your top qualifying spending portfolio, a 2% refund for your next top qualifying spending category, and a 1% refund for all other purchases. The card also includes a “buy cryptocurrency” feature, which allows you to buy cryptocurrencies like Bitcoin with your refund amount — an option that could be attractive to new users of the cryptocurrency.

The bottom line

If you don’t want to use a credit card to spend and if you want to use Venmo instead of a bank debit card, then Venmo Debit Card may be a good option for you. Its integration with the Venmo app is so convenient, it still offers the opportunity to earn money back, and there are more than 37,000 MoneyPass locations in the U.S. that you can use to withdraw money. However, keep in mind that you can’t use a Venmo Debit Card outside the U.S. or to make purchases with international merchants. Finally, if you want to earn more rewards on your purchase, you may want to consider credit cards with alternative rewards.

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