Venmo launches its first credit card

Dive Brief:

Venmo on Monday launched its own credit card and began issuing it to select Venmo customers. Cardholders can earn between 1% and 3% cash back on eligible purchases, track their spending, make payments and split expenses in the Venmo app.
Cardholders will receive custom QR codes, which they can scan to activate the card and use to divide costs with fellow Venmo users. They can also choose among five designs to customize their card, the company said.
Customers can also use a virtual card, which lets users shop online including before their physical card arrives in the mail. The card comes with an RFID-enabled chip to facilitate contactless payments at checkout, per the company statement.

Dive Insight:

After releasing a debit card with Mastercard in June 2018, Venmo is expanding into credit cards, something it teased a year ago. The payment service joins other non-traditional providers in issuing cards. In August 2019, Apple introduced its credit card for U.S. consumers, which also offered up to 3% cash back on select transactions.

Venmo's card offers cash back rewards across different spending categories, including, grocery, health and beauty, gas, entertainment, dining and nightlife, transportation and travel, the company said. Cardholders can make statement payments, make purchases at online and mobile retailers that accept Venmo at checkout and send the funds to their connected bank account or debit card, the company said.

"We know you already rely on Venmo to manage different aspects of your financial life — whether it be sharing and splitting payments with your friends, shopping at online retailers that accept Venmo at checkout, or having your paychecks sent directly to your balance with Venmo," the company wrote in a blog post.

In addition to its credit card, the company has launched other digital features this year aimed at simplifying payments and connecting consumers with small businesses. In July, Venmo introduced its Business Profiles feature, which lets small businesses make profiles and accept payments for their goods and services. In early August, CVS began integrating PayPal and Venmo QR codes into its checkouts across its 8,200 locations across the country.