PayPal Holdings Inc. announced on Monday the launch of debit cards for users of its mobile app Venmo in a bid to widen its reach with younger stars.
Venmo, which has been part of PayPal since 2013, is one of the more popular mobile applications for person-to-person payments in the United States.
Venmo’s Mastercard debit card users can pay in stores using the balance on their app rather than having to transfer funds to their bank account, it said.
The San Jose, California-based company in October rolled out the ability for Venmo users to pay using the app at more two million online retailers.
Venmo Debit Card
With the debit car rollout, PayPal hopes to gain an edge over rivals in the increasingly competitive digital payments landscape, especially in the person-to-person sector.
Venmo’s debit card, now in limited release, will be issued by Bancorp Bank and will allow up to $400 in daily withdrawals.
With Venmo Card, users can use their Venmo balance everywhere. Mastercard is accepted in the U.S., as well as at ATMs that display Mastercard, Cirrus, PULSE, or MoneyPass acceptance marks.
There are no fees for MoneyPass ATM withdrawals, but users will be charged a $2.50 USD domestic withdrawal fee at non-MoneyPass ATMs. In addition, they can only withdraw up to $400 USD each day.
Last year, a consortium of some of the largest banks in the United States launched Zelle, a network that allows customers to send money to each other instantly on their smartphones.
Another competitor is an app called Cash, which is run by Square Inc., the company launched by Twitter Inc. Chief Executive Officer Jack Dorsey. With Cash, people can spend their balance through a debit card.
Venmo processed $12 billion in payments in the first quarter of this year. More than $25 billion moved through Zelle’s network in the same period. Square does not disclose transaction volume for Cash.
Card purchases will show up on a transaction history and can be split with other Venmo users.
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