Venmo has become an increasingly popular service over the past few years. Just about every young American has Venmo and uses it regularly to send money to friends and, occasionally, merchants. However, have you ever tried to use Venmo to send money overseas?
You may be asking why you would want to use Venmo to send money overseas. After all, it is primarily a service used in social situations and not for international purchases. However, if you are hanging out with people who are visiting from London, you may need to send money to a bank account in the UK to pay them back for dinner or a night out.
Alternatively, you may simply want to buy something from a creator overseas who doesn’t consider themselves a merchant. Rather than sending money through an outdated and expensive banking service, using something like Venmo would be great.
But Venmo does not support international payments. Why should this be so? What are the alternatives?
Why doesn’t Venmo support international payments?
The simple reason that Venmo doesn’t support international payments is that this is not part of their unique selling proposition (USP). According to Venmo themselves:
“At its core, Venmo provides a social way to pay your friends when you owe them money and don’t want to deal with cash.”
Venmo is focused on a specific niche and is not trying to be a digital bank account or a comprehensive payments service. The reality is that they would probably offer international payments if not for the legal and administrative resources that would require.
You need to be licensed to send international payments. Furthermore, anti-money laundering laws have significant requirements from companies dealing with large sums of money – simply offering all possible financial services is not desirable for a company like Venmo.
If you’re a young, tech-savvy American, you probably don’t want to deal with your bank in order to send money to international accounts. Are there alternatives?
Alternative ways to send money abroad
If you’re looking for the easiest app to use to send money to a friend from another country, you may consider PayPal. As long as you each have a PayPal account, you can send money in minutes. However, it will cost you.
PayPal fees can be significant even when you send money to someone using US dollars. When you’re sending it to a person using another currency, you will pay so much in fees that making small payments becomes unaffordable.
For this reason, you should look further afield to international money transfer services. These are companies you can use to send money from the USA to the UK, to transfer money to Canada, to transfer to Australia, as well as to many other countries. They require a bit more setup than something like Venmo does.
Money transfer companies offer quite a comprehensive range of services, which is why they aren’t as ‘plug and play’ ready as apps for sending money to friends. The main service is sending money to other countries with different currencies, but there are many other useful features.
If you’re visiting a foreign country, you can get a multi-currency account with a debit card that you can use to pay at any merchant without transfer fees. Other features make it cheaper to send regular payments abroad for large purchases, to receive payments in other currencies, and to hold onto sums of money in those currencies.
Where to send your money
You can use a money transfer company to send money to bank accounts in other countries. The most effective means of sending money, however, is always going to be to send to someone using the same service. It is probably not going to cost you less, but it might take a bit quicker and will be more convenient for them to receive. They can then choose to do whatever they want with it, whether that’s keeping your US dollars or exchanging them for their own currency.
Is it worth it for a night out?
In 2022, we’re all a bit impatient. No one enjoys signing up for new services when not strictly necessary, especially when you don’t know how to use them. Is it worth it to use a money transfer company to pay for a night out with a new friend? Or should you just pay the extra few dollars in fees?
Ultimately, this depends on just how much you hate admin (and how much spare cash you have). Money transfer companies like Wise have gone a long way towards making setting up an account quick and seamless. You don’t have to do a lot of work to get your account working and there’s not much of a learning curve in figuring out how to use it.
In any case, if you do pay using your regular bank account, there will be a fair amount of admin to take care of, including getting the person’s account details and setting up an expensive international payment.
Venmo is not a service you can use for international money transfers. Unfortunately, there is no real equivalent to Venmo when it comes to making quick payments to friends from other countries. However, international money transfer companies are a great alternative that can save you a fair amount of cash.