Venmo Me: PayPal Takes Its Popular App to the Next Level

Even among the heady growth numbers PayPal Holdings Inc (NASDAQ: PYPL) reported in its third-quarter earnings release, the growth of its social payment app Venmo once again easily stood out. The payment app processed $9.4 billion of payment volume in the third quarter, a 93% increase year over year. While PayPal does not reveal the number of Venmo users, management did say that the app added the highest number of new net active accounts in its history, demonstrating its growing popularity.

In the week before the company reported earnings, PayPal made another big announcement regarding Venmo: Venmo would now be accepted as a method of payment at the two million retailers that accepted PayPal.

Investors have been patiently waiting for this move for a long time. Up until this point, Venmo has primarily acted as a P2P payment app, meaning account holders have used it to send money to friends or family. While this function has helped Venmo grow virally, it has not made PayPal any money. The P2P payment feature is offered free to users as long as a bank or funds sitting in the account act as the source of the payment. When a credit card is used, Venmo charges a small fee, but that mostly goes to the credit card company.

Source: Fool.com