Alternatives to Paypal: Venmo

Venmo is for anyone who’s lost a wallet.

In 2009, a bright young college student named Iqram Magdon-Ismail lost his wallet in Philadelphia en route to NYC to visit his pal Andrew Kortina.  Rather than being a foul scrooge to his penniless bud, Kortina paid for everything during the visit.

Magdon-Ismail wrote a check to reimburse his friend, and longed for a more electronic way of doing this.  Venmo was born.

Both Kortina and Magdon-Ismail studied humanities as undergraduates.

Kortina started school planning to major in computer science, but was looking for something a bit more interesting and less prescribed.

Once he and Magdon-Ismail stumbled on the idea for Venmo not long after graduation, they introduced it as a text-messaging payment system.  From there it became an app, and went out of Beta in its (essentially) present form in 2012.

Venmo is a fairly straight-forward and simple p2p operation.  One uses a bank account or dedit card, and when funds come directly from these sources, there are no fees for sending.  Using a credit card will cost you 3%.  Receiving money, as should be the case, is free with Venmo.

The service does work with almost all major U.S. banks, but just U.S. banks—at present, Venmo hasn’t gone global.

By way of security, Venmo goes with SSL, the old Secure Socket Layer and also uses encryption.

The bottom line is, there are plenty of alternatives to Paypal, and Venmo is one of them.  Ultimately, you’ll have to make a decision based on fees, limits, and reach of the service.