We know now, more than ever, many of you are using Venmo to spend and manage your money. Whether you’re sending payments to support friends, family, and people in your community, or paying for essentials like groceries and bills, we’re here to help.

1. Direct Express
2. Venmo Direct Deposit Bank Name

Having quick and easy access to your money is important, especially in times of uncertainty. That’s why we’ve recently started a phased roll out of Direct Deposit on Venmo, so select users can choose to have their paychecks or economic impact payments (stimulus payments)* sent to their balance with Venmo.

Setting-up Direct Deposit

If you’re eligible to use Direct Deposit, for example, if you have the Venmo debit card, you’ll be able to set up Direct Deposit, so your paychecks or tax refunds,** and even government stimulus payments can be sent to your balance with Venmo. Instead of waiting for a paper check, you can access your funds sooner with Direct Deposit, so you can pay Venmo friends or family, help out someone in your community, or shop at millions of online retailers that accept Venmo at checkout, or spend with your Venmo card everywhere Mastercard® is accepted.

How to Qualify: Eligible participants must: (1) complete the employer (or government) form with their Venmo account and routing number and Direct Deposit amount, and (2) receive two (2) Direct Deposits.

Through Direct Deposit with Venmo, we’re not only making it easier to get paid right on time, but you may be able to access your paycheck up to two days early.*** While most traditional banks add a day or two for processing, we help get your money to you as soon as we receive notification from your employer, all without any extra fees.**** With faster access to your paycheck, you can do more with your money, sooner.

• Direct Deposit is a feature that allows eligible users to add all or a portion of their paycheck to their Venmo account electronically. Setting up Direct Deposit allows you to avoid the hassle of waiting for and cashing paper checks.
• Thinking of switching my work direct deposit from my bank to my venmo. Has anybody had experience with this? I’m a little nervous since there’s no concrete bank i can go to if i have any issues.

Setting up Direct Deposit is simple. To see if you’re eligible, select Settings from the drop down menu in the app and tap Direct Deposit, then fill out your employer’s Direct Deposit form using your Venmo-assigned Account and Routing Numbers, and we’ll do the rest.

Accessing Your Economic Impact Payment Digitally

In addition, the IRS launched a new tool for people around the country who would like to receive their Economic Impact Payment digitally, rather than via a paper check. This means select Venmo users can elect to send their stimulus payment directly to their balance with Venmo once they have Direct Deposit set up.

Once you have been enrolled into Direct Deposit, you can receive your stimulus payment into your balance by following these steps:

1. Log into your Venmo account in the app.

2. To view your account number and routing number, tap the ‘☰’ icon, and then click on Settings → Direct Deposit, then select ‘Show Account Number’ to see your Venmo assigned account number, as well as the routing number required for the IRS portal.

3. You can enter the account number and routing number listed in your Venmo Profile under Direct Deposit in the IRS tool to receive your payment.

*Direct Deposit information can only be changed using the IRS tool if you have not filed your 2019 or 2018 tax return, or if you filed your 2019 or 2018 tax return without providing Direct Deposit information.

**Limited to Direct Deposit of a federal or state tax refund, where permitted under applicable law. If you have questions about Direct Deposits from a federal agency, visit godirect.gov.

***Early access compared to standard banking practice of posting funds at settlement and subject to your employer providing pay information to the bank prior to payday. It may take up to two pay cycles for Direct Deposit to take effect. Transactions are reviewed, which may result in delays or funds being frozen or removed from your account.

****The availability of Direct Deposit is subject to your employer sending paycheck information 1-2 days in advance of payday. While Direct Deposit is available at no cost, certain other transaction fees and costs, terms, and conditions are associated with the use of the Venmo debit card. See the Cardholder Agreement and Venmo fees for more details.

The Venmo Mastercard® is issued by The Bancorp Bank pursuant to license by Mastercard International Incorporated. The Bancorp Bank; Member FDIC. Card may be used everywhere Mastercard is accepted in the U.S. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated. The Bancorp Bank does not endorse or sponsor, and is not affiliated in any way with this reward program.

Article last updated 08/12/2020

There are negative consequences with collecting rental income through Venmo, PayPal, Zelle, and direct deposit. I hope you never experience these problems, but I want to educate you on worst case scenarios.

It is important that you treat your rental property management like any other business.

PayPal, Venmo, and Zelle are similar to direct deposit. They allow the tenant to pay at will, which gives the tenant more control. When you have a problematic tenant, you do not want them to be in control.

Here are the major problems that arise when you allow the tenant to be in control:

1. Inability to evict non-paying tenants
   If you allow the tenant to pay via their own mechanism, then they can deposit partial rent into your account. Unprofessional investors and managers allows this to happen and have a difficult time evicting tenants. By accepting partial rent, you can forego your ability to evict them.
2. Clawbacks on the rent paid
   If a tenant uses a consumer-friendly method to deposit rent, the consumer-friendly vendor typically takes the side of the customer (i.e. the tenant) in disputes. Therefore, the money can be retracted if the tenant disputes the rent. This typically happens after they move out, especially if they don't agree with your security deposit refund. A reasonable tenant suddenly becomes unreasonable.
3. Lease gets automatically renewed
   If you do not want to renew a lease, you set yourself up for a difficult court case when you allow the tenant to deposit money at will. By allowing them to use Venmo, PayPal, or direct deposit, you may have already “accepted” next month's rent and are unable to turn over the property sooner.

Now, let's take a deeper dive into each of these three online rent collection methods and real-life examples of what can go wrong.

The problem with direct deposit

I heard a case the other day, which is too unfortunate not to share. An owner sent a 3 day notice to pay rent or quit. After 3 days, the tenant still did not pay. The owner hired an expensive lawyer to take the tenant to court. One day before the court case, the tenant deposited 25% of the total balance due directly into the owner’s bank account (the tenant had the owner’s routing and account number). The owner could not evict the tenant because “partial rent was accepted.” The owner lost the court case and the tenant is living in the property — at a deeply discounted price. The owner not only does not have the full rent, but also had to foot the bill for the lawyer.

The problem with PayPal

First, you leave it up to the tenant to determine the type of payment. If the tenant selects rent as a 'goods and services' transaction, then you can incur fees. PayPal also does not make it as easy to automate your process, systematizing the late fees, allowing control over payments, and showing you are professional in the rental industry.

Second, there is a money back guarantee with PayPal. If the customer representative 'feels' you have defrauded the customer, then they will give the money back to the customer. Imagine if a tenant calls to argue about the security deposit refund. You are leaving it up to a PayPal representative (who has no property management experience) to determine whether or not to refund the tenant.

The problem with Venmo

Direct Express

It’s free — what’s the catch? Nothing in life is free and cheap alternatives cost you in the end. This is a consumer app. Anyone can pay anyone, and the amount is automatically accepted. The problem is identical to the situation described with accepting direct deposit.

In addition, the tenant can cancel their Venmo transaction before it reaches your bank. As this Money article describes, Venmo should not be used for business transactions. The payment platform was built as a convenient way to pay people you know personally.

The problem with Zelle

Zelle may be a better option than PayPal and Venmo (since it goes direct to your bank account), but anyone can pay you and you don't want to accept partial payments from tenants. In addition, banks that are not partnered with Zelle have limits on the amount of money that can be sent, which means you will be accepting partial payments from some tenants.

For example, at the biggest U.S. banks, Zelle Pay daily and monthly limits tend to be around $1,000 per day and at least $5,000 per month, respectively.

One bad tenant can destroy your annual cash flow. Do not let that happen to you. Your only source of income is rent. You do not want to set up your rent collection process to allow the tenant complete control over payments.

Venmo Direct Deposit Bank Name

Tenants refusing your payment method

During initial interactions with a tenant, he/she may refuse to use your preferred method of rent collection. This type of tenant has always been a red flag to me. They are looking for an unprofessional landlord or manager, where they can make excuses for not paying according to the lease agreement.

It is important that you have a solid tenant screening process and an amicable tenant who wants to work with you. You also want to make sure to work with them, by offering one offline method and one online method (some States require an offline form of payment).

The best ways to collect rent

There is a reason professional property managers and real estate investors request rent through only certain methods. The best methods are a money order (for the full amount due) or an online property management system. If you use an online system, make sure it has the following features:

1. Automatic payment scheduling — monthly alerts will reduce the risk of past due payments and help track payments
2. Ability to accept only full payments — reduces the risk of partial payment that prevent moving forward with an eviction in many States
3. Automatic late fees — reduces the risk of late payments by always sending out late fee notices
4. Ability to cancel future payments — if you are starting an eviction, there should be a process in place to cancel the remaining balance of the payment

My top concern with new landlords and real estate investors is that they don’t treat their rentals like a business. They use existing consumer tools that amplify the risk associated with managing rental properties. Have you ever seen a store clerk tell you that you can pay via Venmo or go to your bank to transfer money into their account? No. There is a reason for this. And, rental properties have even more rules and regulations in the court of law.

Venmo and PayPal are great ways to split dinner bills with friends. Zelle is a great way to send money to your friends for a travel experience. But, they are not great ways to set up a professional and sustaining rental business.

Finding and Selecting the Best Tenant