Square Payments vs Venmo – 2024 Comparison

Square and Venmo are two of the most popular digital payment services that allow users to send and receive money quickly through a mobile app or website.

Square was founded in 2009 and began by offering a small credit card reader that could plug into smartphones to allow small businesses to accept credit card payments. Since then, Square has expanded into a suite of payment processing services, including point-of-sale systems, payroll services, loans, and more.

Venmo launched in 2009 as well and was acquired by PayPal in 2013. Venmo is a peer-to-peer payment app that allows users to quickly and easily send money to friends or family. It’s commonly used to split bills, pay someone back, or buy and sell items.

Both Square and Venmo have grown tremendously in popularity over the past decade. However, some key differences exist between Venmo vs. Square’s features, fees, and overall capabilities.

This article provides a detailed comparison of Venmo vs. Square as we look ahead to 2024 to help you determine which option may work best for your needs.

Ease of Use

Regarding ease of use, both Venmo and Square offer simple, user-friendly apps for sending and receiving money.

Square’s app has a clean interface that easily finds options for taking payments or sending money. The App dashboard separates payments, invoices, payroll, and other services. Adding customers and making one-time payments is straightforward with just a few taps. Square also offers preset buttons to send common amounts like $5 or $10 to friends.

Venmo’s app is focused exclusively on peer-to-peer payments in a social feed. The main feed shows recent payments between you and your friends. Tapping the plus button lets you easily search contacts, enter an amount, add notes, and send payments. Venmo’s simple social interface popularized quick, small payments between friends.

Both apps allow you to save preferred users to quickly repeat payments. Venmo vs. Square excels in fast peer-to-peer payments thanks to its simple social feed. At the same time, Square offers a more business-focused interface optimized for taking payments and sending money. Most individuals and small businesses will find Square’s and Venmo’s apps easy to use for basic payments and money transfers.

Transaction Speed

Regarding processing payments quickly, both Square and Venmo perform well, but there are some differences between Venmo vs. Square.

Square payments process extremely fast—usually within one business day. When you pay through Square’s POS system or link a debit card, the funds are deposited into your account by the next day. This rapid settlement makes Square a great choice if you need quick access to funds.

Venmo vs. Square payments are processed rapidly within 1-2 business days. The app uses instant bank transfers to deliver funds quickly into your account. However, there is one caveat—Venmo payments between users are initially marked as “pending” before clearing. So you’ll see the money right away, but it takes 1-2 days to officially process.

We know Gen Z & Mobile Apps relationship; they can’t wait and want everything done swiftly. Therefore, Venmo may have a slight edge for very quick peer-to-peer payments due to its newsfeed and emoji functions that facilitate rapid small transfers. But for business payments that need to clear ASAP, Square has the advantage.

Overall, both platforms are designed to provide fast payment processing and near real-time access to funds. Speed is not likely a major factor in choosing one over the other. However, Square does appear slightly faster, especially for larger business transactions.

Fees and Pricing

Regarding fees and pricing, Square and Venmo take different approaches. To help you understand better, The App Founders‘ experts have broken down both approaches.

Square charges a flat rate per transaction:

• 6% + 10¢ for tap, dip, or swipe
• 5% + 15¢ for manually entered transactions

There are no additional fees beyond the per-transaction cost. So whether you’re running a small e-commerce shop or a full-service restaurant, you’ll pay the same simple rate.

Venmo uses a tiered pricing model based on volume:

• Below $299/month is free
• $300-$9,999/month is 1.9% + 10¢
• $10,000-$399,999/month is 1.7%
• $400,000+/month is 1.5%

There are no additional fees for standard peer-to-peer transfers. However, Venmo does charge a 1% fee for Instant Transfers to debit cards or bank accounts.

So, for low-volume merchants, Venmo is free but becomes more expensive at higher volumes compared to Square’s flat rate. The pricing models cater to different types of businesses, so consider your average monthly volume when deciding.

Payment Limits

Square and Venmo have maximum payment limits as a security precaution.

Venmo’s maximum payment amount is $3,000 per transaction, and no more than $20,000 in payments can be sent or received in a week. This makes Venmo better suited for personal payments between friends and family. Trying to send or receive payments above these limits will result in an error.

Square’s maximum payment amount depends on the specific Square product being used. For individuals, the Square Cash App allows up to $250 per transaction with a weekly limit of $1,000 for accounts without added verification. Square Cash for Businesses imposes a rolling 30-day limit of $250,000 in payments.

Square Payments imposes limits for merchants based on monthly payment volume processed and risk level. New merchants usually start with a $1,000 limit per transaction. The maximum possible limit is $20,000 per transaction.

Overall, Square accommodates much higher payment limits than Venmo. This makes it better suited for business payments and higher-value personal transactions.

Security

Security is a top concern for any payment platform. Square and Venmo use encryption and fraud protection to secure transactions and customer data.

– Data encryption:

Square and Venmo encrypt all payment data in transit and at rest. This prevents unauthorized parties from accessing sensitive information if data is intercepted. Both use industry-standard encryption protocols to protect card numbers, bank details, and personal information.

– Fraud protection:

Square and Venmo have dedicated fraud prevention teams and use AI and machine learning to analyze transactions for suspicious activity. They monitor transaction frequency, size, location, IP address, and more to flag potentially fraudulent payments. If fraud is detected, they temporarily disable accounts and contact users to resolve issues.

Chargeback protection

Square offers chargeback protection on eligible debit card transactions, shielding merchants from losses due to fraudulent purchases. Venmo does not offer chargeback protection but will work with users who experience fraud to investigate incidents and recover lost funds if possible.

For added security, Venmo users can enable a PIN code to open the app and make payments. Square does not offer a PIN-based option at this time.

Overall, Square and Venmo prioritize security with multiple layers of encryption, fraud analysis, and account monitoring. Square goes a step further with chargeback protection and loss coverage for businesses. But both platforms implement strong safeguards to keep customer money and data safe.

Mobile Apps

Both Square and Venmo offer intuitive mobile apps that simplify sending and receiving payments.

The Venmo mobile app has over 70 million downloads on iOS and Android devices. It has a 4.8-star rating on the App Store and 4.4 on Google Play, with reviewers praising its simple UI, emojis, and social feed. Key features include easy money transfers, payment requests, purchase protection, and data privacy controls.

Square’s Cash App has over 50 million downloads and a 4.8 rating on the App Store and Google Play. Users love the $cashtags, investing tools, and debit card integration. You can instantly send/receive money, get paid early with direct deposit, buy/sell Bitcoin, and manage finances in one place.

While both apps focus on user experience importance, Venmo still edges out Square with its higher download count and more social, fun vibe. But Square’s Cash App offers more financial services in one place. Both apps make peer-to-peer and merchant payments incredibly seamless from your smartphone.

Conclusion

In 2024, both Venmo vs. Square remain top choices for digital payments and money transfers. However, they excel in different areas.

Square Payments stands out with its full-featured point-of-sale system optimized for brick-and-mortar and online businesses.

In contrast, Venmo remains focused on peer-to-peer transactions and social networking. Its streamlined mobile app and social newsfeed make splitting bills and reimbursing friends a breeze.

Overall, Square Payments is the winner in features and functionality for business owners. But for personal payments and transfers, Venmo can’t be beat for simplicity. Both services will continue leading the digital payments revolution in 2024 and beyond.