These accounts are safe and transparent, with users receiving FDIC Insurance on their accounts depending on the products they use,” the association said. “Tens of millions of American consumers and small businesses rely on payment apps to better spend, manage, and send their money. The Financial Technology Association, an industry group that represents PayPal as well as Cash App’s owner Block, emphasized in a statement that those products are safe. The savings account took in billions of dollars in deposits within days of its launch. Venmo now has more than 90 million customers and recently announced it was going to allow parents to create accounts for their teenage children, potentially bringing in tens of millions of new customers for the app.Īpple recently announced a savings account tied to its Apple Card that is operated by Goldman Sachs. PayPal is a more established company and I feel safe sending money through their website. Peer-to-Peer payment apps and non-banks offering bank-like services have exploded in popularity in the last decade. 2 days ago &0183 &32 A new Venmo Groups feature makes it easy for family and friends to split bills, track shared holiday spending, or even sort out shared expenses for longer periods. Shares of PayPal have risen 23.2% in 2021 to-date, outperforming against the S&P 500's 20.6% rise over that period.Įmily McCormick is a reporter for Yahoo Finance.“Consumers may not fully appreciate when, or under what conditions, they would be protected by deposit insurance,” the agency added in its report. The amount of money you can transfer will. (PYPL intends to expand Venmo into international markets within the next five years), which offers upside potential to our estimates." It launched in 2017 to compete with the likes of PayPal and Venmo, both of which are owned by PayPal Holdings Inc. "Notably, our analysis does not consider expansion of Venmo into new countries outside of the U.S. "PYPL has said Venmo is expected to generate positive operating income starting in 2022, but we believe the volume and revenue momentum of the platform is more important for the stock," Kupferberg said. Like Venmo, Cash App has grown considerably in the past year, with monthly transacting active customers increasing by more than 30% to 40 million in June this year. PayPal has also been in competition with rival payments company Square ( SQ), which offers its own flagship peer-to-peer payments and wallet platform Cash App. And Venmo's payments volume growth rate also accelerated from the second quarter of 2020, when total payment volume increased 52%. Venmo processed about $58 billion in total payment volume in the second quarter this year, with this sum growing 58%, compared to the same period last year and comprising about nearly one-fifth of PayPal's total payment volume during the quarter. This would build on growth both PayPal and Venmo have seen over the course of the past year-and-a-half, with stay-in-place behaviors during the COVID-19 pandemic helping to fuel digital payments growth. (Photo Illustration by Pavlo Gonchar/SOPA Images/LightRocket via Getty Images) (SOPA Images via Getty Images) UKRAINE - 0: In this photo illustration, PayPal logo is seen displayed on a smartphone screen in front of Venmo logo. In short, Venmo is owned by PayPal, which acquired the company back in 2013 after taking over payment processor Braintree. "That would imply total Venmo revenues of $2.4B in 2023 (6% of total revs), versus the expected ~$900M in 2021 (~3.5% of total revs)." "The punchline is that in our base case, we estimate total active Venmo users could reach 120M in 2023 (up from 76M as of 2Q) and that ARPU for Venmo could reach $19.92, reflecting a ~30% CAGR (compound annual growth rate) from 2020-2023," he said. Additional functions through the app would offer even further monetization opportunities, Kupferberg added. "We expect these features will drive continued strong growth in Venmo users, and accelerate growth in average revenue per user (ARPU) over the coming years," said Kupferberg, who rates the stock as a Buy with a price target of $323, implying further upside of 12% from Monday's closing prices.įor now, Venmo's revenue streams have come from fees from its credit and debit cards, merchant payments and cryptocurrency transactions on the platform, and instant transfers, or when users pay to immediately send Venmo balances to their banks. As part of PayPal's plan to become a stock trading app that will allow users to buy, sell and hold individual stocks, the company brought on former Ally Invest president Rich Hagen, CNBC first reported. A PayPal spokesperson confirmed the latest report to Yahoo Finance, noting CEO Dan Schulman discussed intentions to launch a stock-investing platform at the company's investor day in February.
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