Comparison

Zelle Vs Venmo – What are the key differences?

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Zelle and Venmo are digital wallet payment services and allow users to conduct payment transactions. Based on a digital payments network, Zelle and Venmo are financial services products that allow users to send and receive money electronically. Users can start using these products via their mobile devices .Zelle Vs Venmo, Both being instant money transfer and receipt services are linked to users’ bank accounts. 

Zelle works on the principle of known payees. Payers can transact with payees whom they know and fully trust. A Zelle user can send money to another Zelle user. Money can be sent to unregistered recipients too – in which case the unregistered recipient receives an email to sign-up for the Zelle service, to receive the payment. There are two ways Zelle users can make payments via Zelle. One is through the mobile app. The other is through apps and websites of U.S. financial institutions that are participating in the Zelle network. 

Only the recipient’s mobile number and/or email address is required to send them money. To enroll multiple bank accounts into Zelle, unique email addresses, or mobile numbers are required for each bank account. In addition to allowing users to send and receive money, Zelle also allows users to submit requests to others, asking them to send them money or split the cost of an expense or payment between them.

There could be limits to the amount of money and the number of transactions that can be made per day based on the financial institution rules and regulations. Some banks allow up to $2500 daily while some others $4000. Some banks offer more sizeable transfers if transacting via their website. 

The point to note is that a payment made via Zelle cannot be cancelled. Zelle transactions are fast and resolve in a matter of minutes.

What is Venmo?

Venmo has a similar working philosophy as Zelle. Users can register with the Venmo service by providing their bank account information. Venmo users are identified on the Venmo payments network by way of their username, email address, or phone number. Venmo users can maintain a balance that can be used to make payments. Money balance can be replenished by retrieving money from linked bank accounts, credit cards, or debit cards. Users can also link their Venmo Mastercards. 

Venmo includes interaction via a social networking platform. It was created so that users could split expenses or bills. When a user transacts, the details of the transaction (without the transaction amount) are shared on the “news feed” of the user and also to the user’s friends’ network. 

There are multiple feeds that Venmo allows users to maintain. Apart from the user’s personal feed, there is the “Worldwide feed,” and also a “friends only” feed. Even as a payment service, Venmo allows users to interact via the social media platform by way of posting comments. 

Zelle Vs Venmo – What Are The Differences?

Here are some main differences between Zelle Vs Venmo:

  • Zelle allows to send and receive money – there is no facility to maintain a balance. Venmo has this feature. 
  • If the bank allows payments to be made via its Zelle integration, it can be used to make payments over the Zelle payments network. This facility is not available with Venmo. Users of Venmo will need to transact only via the Venmo app.
  • Zelle transactions are resolved within a matter of minutes. It levies no charge for payments. Venmo has a slightly longer transaction resolution time. Venmo instant transfers (that are faster) come at a 1% charge.
  • Venmo has a smaller set of authorized merchant partners as part of its payments network. Venmo doesn’t provide users to create business accounts as standard accounts. Zelle can be used for small businesses, only if the banking institution associated with the Zelle account allows it.
  • Zelle uses a secure payment gateway and payment authorizations for fraud monitoring. Venmo uses encryption to safeguard details. It also has fraud monitoring integrated into the payment process. However, in Venmo, one can add a PIN. This helps in cases where the phone could be lost, and the Venmo account can simply be disconnected from the phone to disallow anyone from misusing the service.

Zello Vs Venmo - How To Choose A Digital Wallet

The fintech sector has undergone a vast transformation courtesy automated solutions such as digital wallet payments technology. With the increase in smartphone users, higher Internet penetration, digital payments are becoming the norm. Generations of digitally-native users will adopt digital payments wallets even more. Paper currency will become virtually non-existent. Smartphones will replace credit and debit cards. E-commerce businesses, financial companies, telecom companies, and banks are all building their digital payments technological infrastructure to support the proliferation of digital payments wallet technology.

There are lots of payments app to choose from. Choosing the right one could become a daunting task. Here are some points to consider in this regard.

Instant Payments

If there is provision for instant payments from one wallet to another, at zero or negligible transaction fees, then this aspect is a clear winner. It allows as many transactions to be conducted between wallets. It allows small businesses and individual users to transact without worrying about incurring cumulatively accumulated transaction costs.

The anytime, anywhere money transfer and receipt technology are hugely beneficial in a fast-paced commercial digital ecosystem. In a cashless economy, most digital payments wallet providers are providing instant transfers with zero fees. So look for one such digital payment wallet.

Transactions With Banks

A digital transfer wallet or a digital money transfer wallet should allow transactions to be conducted with any bank. The process should be seamless and non-cumbersome. Not only should transactions be allowed between the user and their own bank account, but they should be able to transact with any bank account. And this process should be within a matter of a few clicks. There are a lot many digital payments services that offer such conveniences – in a matter of clicks, money can be transferred or received from any bank account.

Bill Payments

Online bill payment is not a trend anymore. It is a bare necessity. The era of waiting in a queue to pay an electricity bill, water bill, mortgage, loan, etc. is long gone or is being phased out gradually. This is because digital payments are more secure and less prone to human errors. It is also cost-effective, saves time and effort. So choose a digital payment gateway that allows bill payments. In fact – any bill payment. 

Integration Of Credit And Debit Cards

Carrying fat physical wallets with numerous credit and debit cards creates a lot of problems. They could be stolen, lost, or misused. Credit card and debit card fraud is one of the biggest challenges faced by the fintech economy, which is trying hard to root the problem out through the use of technology. Come to the digital age, thanks to mobile-based money wallets, all credit card, and debit card information can be integrated into a single digital cashless virtual wallet. It is not only high-grade secure; the wallet does not store credit or debit card numbers. The user can also block their use in a matter of clicks.

Contactless Technology For Merchant Payments

Merchants are going big on investing in technology infrastructure that allows payments made via digital wallets. Near-field communication (NFC), QR code is some of the contactless methods in this regard, used by retail clients to make payments in-store. NFC is a game-changing technology that allows smartphones and POS (point of sales) devices to communicate from a distance and allows for secure transfer or exchange of payments data. If the digital payments wallet provides NFC and QR, then it’s a pretty good one, to say the least.

Security

Financial services invest billions to secure their transactional Internet-based networks to sieve out potential threats. Most financial fraud is caused more by user negligence than by security vulnerabilities on the network. That’s why it is important to practice safe Internet usage habits. Digital wallets factor such considerations and don’t leave out everything to the user. In the interest of being customer-centric, digital wallets provide proactive support, often mediating between potentially hazardous usages or user actions that could compromise the user’s transaction security. 

At a basic, digital wallets provide point to point encryption, passwords, biometric identification, tokenization, out of band authentication, SMS or email-based One Time Password, security questions, etc. Check if such features exist in the digital wallet. Most probably, they will.

Easy Registration

Self-registration on digital mobile wallets should enable even non-tech or first-time users to intuitively sign-up and start using the service. This aspect encourages more people to enter the digital payments realm, thereby slowly eliminating the need for paper currency. If the registration flow of a digital app has too many non-connected steps or is illogical or very disparate, it is a clear indication that not much thought has been put into it. Although this should not be a case to reject the digital wallet, it could prove to be a pain-point for novice users or those who were never keen on using technology.

Discounts, Rewards, Coupons

Digital mobile-based payments technology companies focus on customer engagement. They want to encourage their users to transact more and transact the right way. Therefore, the companies provide a lot of promotional offers, coupons, rewards-points based on transactions, loyalty points, etc. Although customer or end-user engagement initiatives are never a high priority to choose a digital payment wallet, a wallet having them shows that they care about their customers. It can also make digital wallet usage fun and exciting. There is something to look forward to always when using the wallet service.

Split Bill Service

This is a convenient service. Splitting the bill is an almost routine activity. When on a movie, dinner, leisure trip, and such activities, bills can be shared. There are some apps that split the bill and inform people how much each one owes. But if this feature is built-in to a mobile wallet service, it becomes easier. So that one can go out with as many friends, as many times, and not worry about bill distribution at the end of the day or trip.

Withdrawing OR Depositing Cash At An ATM OR Bank Branch

Mobile wallets come with features that allow users to make ATM cash withdrawals without the need to swipe in a physical credit or debit card. This is particularly helpful when paper currency is needed urgently. Some banks also allow such facilities, where users can withdraw or even deposit money using their mobile wallets using NFC and QR technologies. These contactless technologies can be used by either tapping the POS terminal or scanning the QR code. Although this is an advanced technology, its mass adoption is increasing daily. 

Origination Of Loans

Many common banking features are slowly being integrated into digital wallets. One of them is loan origination. It refers to applying for a loan. Users can apply for a loan within their digital wallets by filling a form and submitting it. Banks use automated technology to approve/disapprove the loan application process. Some of it could require manual scrutiny, but this is changing too. 

Dashboards and analytical charts

Transactional usage statistics provide an indication of the overall financial health of the user. It becomes imperative at a time when users need to stay atop their money. Financial compliance and discipline ensure that users stay in good financial standing with all banks and financial institutions. Digital wallets that provide such metrics/data visualization enable users to make informed decisions on their future transactions.

Zelle Vs Venmo - Conclusion

Zelle Vs Venmo,both are equally good mobile digital wallet products. There are some advantages and disadvantages of one over the other. When it comes to deciding which one to use, it comes down to personal preferences. Based on the aforementioned points, choosing Zelle Vs Venmo could become more of a case of personal convenience. Check user reviews on these products from verified sites. Even better – use both of them and find out. Often the answer lies there! 

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