Venmo said on Monday that it could be used in any store that accepts MasterCard. This should help the PayPal application.
Venmo grew to popularity. Users had to link the application to a bank account in order to deposit or withdraw their money. A new debit card will allow users to spend their Venmo scales in the physical world without any gear. The card will also work in ATMs without a fee in the MoneyPass network or $ 2.50 per transaction in other networks.
"This is a smart move," said analyst James Vester, director of research at IDC Global Payments. "Now, users can skip this middle step, turning it into a more suitable prepaid account."
Banks fought against the popularity of Venmo, especially among millennia, with its applications. A group of the most banks, including Citigroup, Bank of America and J.P. Morgan Chase, has created a free Zelle service for sharing resources between friends. Since it was developed by banks, Zelle has links to users of bank accounts, debit cards and other banking services. A new debit card Venmo can be an attempt to compare the advantages of banks. Apple and other technical companies are able to copy the function of money exchange for their payment applications. Last year, Venomo added the opportunity to pay for online purchases, simply trying to match one of the main features of Apple Pay.
For example, a new card will be associated with the Venomo application. And users can choose from six bright colors for their card, for example, pink, yellow or black.
PayPal does not regularly publish a lot of information about Venmo, as well as the total number of active users. In April, when it published its financial results for the first quarter, PayPal said it processed Venomo transactions for $ 12.3 billion, an increase of 80% compared to the same period in 2017. Zelle said that in the first quarter, it transferred $ 25 billion.
Investors may not be impressed with the offer of a debit card. One way to provide financial services is money, by investing such balances of customers, to which they do not pay interest. The shares of PayPal fell by 4% in the daily trading on Monday, although the overall market also fell sharply.