How Much Does It Cost to Develop a P2P Payment App Like Venmo?
With the number of mobile-based P2P payment users reaching 26 million in the USA alone, the industry is showing a picture of uncontested growth.
Straight from the number of participating players such as top fintech software development companies to the transaction volume that is on the verge of becoming mobile-only, every facet of the P2P payments industry is on a fast-tracked growth rate.
The transactional growth of P2P payment marketplace is mainly the mix of these two factors driven by the leading P2P payment providers:
- User’s inclination towards innovative tech
- Ease of doing untimed financial transactions.
Now when we talk about the mobile P2P payment providers that have contributed to shaping the present state of the industry, there are a few names that emerge to rule the charts. Some of the best cash apps that have made it to the list are –
Venmo is leading the charts in best peer to peer payment apps.
Popularized by Braintree, P2P payment app Venmo, at the back of its innovative features, saw itself becoming the center of Millenials’ attraction in 2012 when it was acquired by Braintree. And soon, the stories of its ease and social quotient reached the ears of PayPal who took no time in acquiring Braintree and became the name behind Venmo.
The tag of being a part of the PayPal family brought an instant spike in demand for the application. A demand that has grown to such an extent that it has become a tough competition for other industry’s players and an ideal business model for the many entrepreneurs who aim to follow its growth trend.
Now the primary question that these entrepreneurs are always struggling to find an answer to is How Much Does Venmo Clone App Development Costs? One that is very closely related to how to build the best P2P payment app.
Well, the struggle ends here.
We are here to answer how much does it cost to develop a peer to peer payment apps like Venmo.
In this article, we are going to discuss the Venmo app holistically – covering not just what does Venmo’s cost structure looks like but also its market and the features that made the app famous.
But before we head on to the estimate of the cost to develop a best p2p app like Venmo, let us start by looking at the market growth chart that Venmo business model has drawn for itself among the users across all its operative nations.
One of the reasons why Venmo has found a strong, loyal customer base in the P2P payments market is because of its easy user flow which brings down the learnability curve. Knowing how the users move within Venmo can be a great starting point for entrepreneurs who are looking for an answer to how to create best peer to peer payment apps like Venmo.
While this is simply a skeleton view of the Venmo app user journey, there are a number of features that go behind the development of the mass.
It is these features that go into forming the answer of how to build a P2P payments app and the estimation of cost to develop a best P2P app like Venmo.
Let’s look at what those features are.
Primary Features of Venmo Like Application
1. Make payments
The primary/base feature of the Venmo like application would be the facility to make payments in real-time. You can either make payments to someone you know or you can use your Venmo money for bill payments.
2. Link bank accounts and debit cards
Another important element of a P2P payment services like Venmo is enabling users to link their bank accounts and debit cards in the app. This makes it easier for the users to make payment straight from their bank account, without having to rely on the in-built wallet.
Venmo, one of the best cash apps, has tied up with a number of businesses and websites for enabling the facility of making purchases on their sites through the app. To make the whole process streamlined, they have created their own API.
4. Venmo Money transfers
In order to make your peer to peer payment system all the more useful and convenient, you should give users the feasibility of P2P money transfer from their Venmo like application to their bank account. And then from their bank account to their app wallet.
The ease with which Venmo P2P money transfer happens is something that you too should plan to achieve in your app design.
5. Share payments
One of the features that separate Venmo business model from other payment applications is that it gives the option of sharing the payment transactions with friends and other people in the Venmo app through an in-built social feed.
6. Sync with Facebook and phone contacts
Syncing phone contacts should be an obvious part of your Venmo like application in order to make it easy for your P2P payment users to easily find people to connect with. But syncing Facebook with the application is more of a Venmo centric feature. The idea behind this is to make the whole process of selecting contacts and sending messages expansive and convenient.
7. Data encryption
This part of the feature deals with creating an ecosystem where the data of the users are protected with such robustness that they become hack-proof.
8. Request money
Using this feature, users can request money from other Venmo users who owe them an amount. This functionality requires an in-app messaging and notification feature to notify the other users of the request.
9. Track payments
Both for the sake of federal financial regulations and user experience, you should give the users the option to keep track of their financial history. In addition to giving the option to track transaction history inside the application, you should send them weekly/ monthly emailers as well.
10. PIN code
It is very important for you to have a multi-factor authentication system integrated into your application. It helps in ensuring that your users’ account is secure and that nobody is able to use the application when the phone is unlocked, besides them.
11. Account settings
The next crucial feature that should be added in your P2P apps is account settings. Your users should be given a space where they update information and select a preferred payment method, amongst other features.
12. Split bills
This feature is related to giving your users the ease to split bills with their friends from inside the application itself.
13. Notification Alert
Use this feature to alert users every time a payment is made or received. Users will get information about these activities as well as any changes made to their digital wallet.
Chatbots or virtual assistants must be implemented in your peer to peer payment app to save users during disputes in transactions. Before even making a simple purchase, users might want some questions answered. In such situations, virtual assistants can help in making tasks easier for users.
15. Buy/sell cryptocurrency
Cryptocurrencies such as Bitcoins have been talk of the town for the past couple of years. You can add a feature in your Venmo like peer to peer payment apps wherein users can buy and sell cryptocurrencies efficiently and safely. This feature can be a game changer as it will attract many people who have keen interest in Bitcoin and other cryptocurrencies.
The features set that we just looked at are ones which are commonly present in the many peer to peer payments apps. And this commonality is what makes them the must-have features that a Fintech app development company generally works around.
But when we talk specifically about Venmo, there is one feature that stands out – Social Feed.
Let’s spend a few minutes on it.
The One Feature That Has Made Venmo a Millennial’s Favorite
While other P2P apps are more on the transaction side of the operation as compared to social, Venmo offers a pleasant change with its Social Feed functionality.
Along with being one of the most leading P2P apps, Venmo also acts as a social network for its millennial user base.
Users can share their payment activity with their friends who can then post a comment using the ‘Friends’ feed. The users can even share their activity with the whole Venmo public for strangers to see and react to it via the app’s public feed.
For a lot of the young aged consumers, sharing everyday activities is how they lead their life. And catering this second nature of the consumers has become an inherent part of the business models of companies like Instagram and Venmo.
“Venmo is not an inherently social app in the way of Facebook or Twitter, but it offers emotional support and the ability to keep in touch,” said Cliff Lampe, the social-media professor at the University of Michigan’s School of Information. “Young people are good at repurposing feeds and emojis and signals to mean different things and to become social even when it’s not intended to be social.”
Even though Venmo exists to perform the same old boring purpose of P2P money transfers and paying bills, the social feed is what makes it the emoji infused, millennial heavy, thriving social phenomenon.
The feature set that we have listed above – both ones that are common in all P2P payment apps and the ones which are specific to Venmo, come attached with a price range that can be a little on the higher side.
Moving forward, here’s the answer to How much does Venmo clone app development costs.
How Much Does Venmo Like App Development Costs?
The feature set and security measures that a Venmo like application requires, puts it in the category of a high complexity app.
Now while there are still a number of other things to be considered when deciding on the Venmo like app development cost, it is possible to give a rough ballpark range on the basis of the features set mentioned above.
In case your feature set is specific to the ones mentioned above, the answer to what is the cost to create best cash apps similar to Venmo will come down to something like USD 100K and USD 150K.
Although the range is on the higher end, as the app’s complexity demands, the rate of return is considerably higher.
Especially when you keep Venmo’s monetization model into consideration.
How Does Venmo App Make Money?
There are multiple ways through which Venmo makes money – ways that the brand is going to use more extensively since it is not presently in a high-profit state.
Here are the ones which you can incorporate in your Venmo like application –
1. Credit Card Payment Charges
Venmo charges a 3% transaction fee when payment is made through credit card as opposed to a debit card transaction. By incorporating this monetization model in your P2P payment wallet app, you will not just become the recipient of a steady income but would also be able to cut down on the losses that you might face when the credit card payment doesn’t go through.
2. Faster Money Transfer Charges
Venmo charges a fixed amount from all app users who wish to avail the fast peer to peer money transfer facility. What happens is that usually, Venmo takes some two or three days to transfer money to the users’ bank account but when the user agrees to pay an additional amount to expedite the P2P money transfers, the money transfer time shortens to a great extent.
3. Merchant Charges
Venmo monetizes from its merchant partners to a great extent. This is also one of the reasons why the company is working on increasing the customers to business transactions on the platform.
The idea of this plan is that Venmo takes a percent cut, something around 2.9% of the transaction charges.
4. Cash a Check
In January 2021, Venmo launched a new service called Cash A Check. By using this feature, users can cash checks and have them sent to a Venmo account. Eligible customers can take a picture of the check they want to cash and send it for review using the Venmo app, rather than visiting a physical check-cashing location. If approved, this peer to peer money transfer app deposits the money into the user’s account. Venmo charges 1 percent in exchange for this verification service. A minimum of $5 has to be cashed in.
5. Cashback Program
Like most other debit cards, Venmo offers a cashback reward facility to users at selected merchants. These cashback programs transfer a percentage of the overall purchase price back to the customer’s account. The partner then pays this peer to peer money transfer app a commission for referring that customer.
FAQs About Cost to Develop the Best P2P Payment App Like Venmo
1. How do I make a Venmo like P2P payment app?
The process of Venmo like P2P payment app development requires an in-depth understanding of the feature set that you will be basing the application on. In addition to the factors, it also helps to know the technology stack and team requirement, etc to initiate the whole Venmo like app development process.
2. How does peer to peer payments work in Venmo?
P2P payment apps like Venmo or SquareCash allow users to send each other money from their mobile devices through P2P payments. To make the best peer to peer money transfer possible, they are giving the functionality to both – link their bank account/ card and keep the money in their in-app wallet.
3. How does Venmo make money?
There are five ways through which Venmo primarily makes money –
- Credit card payment charges
- Merchant charges
- Faster money transfers
- Cash a Check
- Cashback Program
4. What are some of the Venmo pros and cons?
Venmo pros and cons are as follows:
Pros: Send and receive cash effortlessly, low fee for credit card payments, offers a debit and credit card, etc.
Cons: No international transactions, can’t cancel payments, etc.
This was all about how Venmo makes money, what is peer to peer transfer, and how much does it cost to develop an app like Venmo. If you are still with us, reading the piece, you are now 80% on the path of becoming the next Venmo app.
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