PayPal Holdings Inc. increased a Venmo fee as part of a broader push to make money from the fast-growing mobile payment service, prompting backlash from users on social media.<\/p>\n
PayPal said it will charge 1 percent when Venmo account holders transfer money quickly to their bank accounts, starting Nov. 6. When the feature was first rolled out, there was a 25-cent fee on the transactions. Users will still be able to do standard bank transfers for free but those take one to three days, rather than roughly 30 minutes for the other method.<\/p>\n
\u201cThe change reflects the value that Venmo\u2019s services offer \u2013 providing speed and convenience for customers that want to transfer their funds to their bank accounts in 30 minutes or less,\u201d a PayPal spokeswoman wrote in an email.<\/p>\n
Venmo has been a hit with young, smartphone-wielding consumers, giving PayPal a valuable source of growth and future transaction volume. But the unit is still unprofitable, and the company has been slowly trying to change that.<\/p>\n
Over the summer, Venmo introduced a debit card, giving PayPal a small cut of transactions at retail stores and other merchants. In July, PayPal Chief Operating Officer Bill Ready said 17 percent of Venmo users had done something that generated revenue in 2018.<\/p>\n
\u201cThere\u2019s a lot left in front of us,\u201d he said. \u201cIt\u2019ll be a multiyear journey.\u201d<\/p>\n
Venmo users aren\u2019t so enthused by PayPal\u2019s effort to squeeze more money from their transactions, though that was coupled with some confusion over which transfers will and won\u2019t be subject to the new fee.<\/p>\n
\nWow, @venmo<\/a> casually tells users in the late afternoon on Friday that bank transfers will now cost \u201c1% of the transfer amount (minimum fee $0.25)\u201d pic.twitter.com\/FQBXwVoSVH<\/a><\/p>\n
— Alex Rosen (@rosen_alexandra) October 13, 2018<\/a><\/p><\/blockquote>\n