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Venmo Waives Fee For Stimulus Check Deposits

Updated on February 18, 2021 12:00 am
Venmo Free deposits

Venmo, PayPal owned peer-to-peer payment service recently added a new feature called Cash a Check for both its Android and iOS apps. This new feature allows select customers in the U.S. to take a snap of a check, send it for review using the Venmo app on a mobile device, and deposit the fund into a Venmo account instead of visiting a physical check-cashing location or worrying about following social distancing measures.

Venmo's parent company, Paypal already has a similar feature that allows users to cash checks in the PayPal app. The cashing service in both the app is provided by partners First Century Bank and Ingo Money.

The feature can be used to cash any printed, payroll, and U.S. government checks, including the new government-issued stimulus checks giving people quick and easy access to their money, especially for people who are receiving paper checks and would have to physically go to a cashing location.

The U.S. government has been sending stimulus checks to most Americans, in response to the COVID-19 induced economic crisis that forced millions of people out of work and putting many in serious financial hardships.

In the midst of nationwide lockdown and social distancing protocols, fintech companies have come to the rescue by providing convenient, safe, and reliable payment methods to people for sending money to friends and family who are in dire need of financial support. The use of contactless payments has been on the rise amid the virus scare. The pandemic has indeed accelerated the use of fintech solutions.

Cash Your Stimulus Checks with Venmo's Cash A Check Feature from the Safety of your Home at Zero Cost

Venmo is waiving all fees for cashing stimulus checks deposits for a limited time to provide affordable access to the much-needed fund so that people can use it to pay for things they need the most.

Normally, as per PayPal's terms and conditions, the fees charged for cashing a check is 1% (a $5 minimum) for payroll or government checks with pre-printed signatures and 5% for hand-signed checks, with a minimum of $5.

Darrell Esch, Venmo SVP and GM, talking about the new service said the company is continuously looking for new ways for the community to have easier access and manage their money, especially as people continue to experience financial hardships amidst the global pandemic.

How to Use the Venmo app for Cashing Stimulus Checks?

To use the Cash a Check feature, you'll need a Venmo account, a Venmo debit, or an active direct deposit on the account and a verified email address. The feature also requires location services to be active.

venmo deposit

Here are the steps to use the Venmo app for cashing stimulus checks:

  • Download the Venmo app if you haven't and create an account first
  • Tap on the side menu panel
  • Choose Settings
  • Scroll down and under the Buying section, tap Cash a Check
  • Tap Get Started
  • Read and accept the terms and privacy policy
  • Enter the check amount
  • Follow the onscreen prompts to use the app to take a photo of your check
  • Tap the checkmark to proceed

To verify the check, Venmo will then conduct a review before disbursing the fund. The review process only takes a few seconds to 3-5 minutes. In rare circumstances, it may take an hour to make the approval decision.

Once the check is approved, the money is immediately transferred to the customer's Venmo account. If the check isn't approved, it is not processed, and the funds aren't sent to the account.

Tap on the Check Activity to track your transactions. You'll find it after tapping the setting icon on the screen where you entered the check's amount.

To access the new Cash a Check feature, you will have to download the latest version of the Venmo app (both on iOS or Android) and your system should be running the latest operating system on your mobile device.



Conclusions

The check-cashing feature adds to Venmo's expanding banking services, although it is far from being an alternative to an online banking app.

It also launched its first credit card to eligible users in the U.S. each having its own unique QR code and RFID chip and cashback rewards.

An important benefit of the new feature is that the influx of stimulus payments can help increase Venmo's profit beyond the fees it charges. Having access to their stimulus check deposits and payroll in their Venmo account, people may use the money for online transactions or use their Venmo debit card to do the same. Venmo can then earn revenue via the transaction fees.

In less than two years, there has been a significant increase in Venmo users, now standing at over 50 million. Venmo's user base is largely millennials under 35 years of age.

PayPal forecast Venmo's revenue to approach $900 million in 2021 owing to investments in new capabilities and reach profitability in 2022.

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