Is Venmo The New Leader in Mobile Payments?

Even casual observers of the mobile payment market are familiar with Venmo, and the fact that, in general, it’s pretty much running away with the peer-to-peer (P2P) market while pretty much everyone else involved is playing catch-up.

Some newly released data, however, suggests that Venmo isn’t just dominating the P2P market, but also the whole mobile payments arena.

The numbers are stark in their clarity: a study found that 68 percent of users turned most frequently to Venmo for mobile payments in general, and since Venmo processed a whopping $6.8 billion in payments just in the first quarter of 2017 alone, that adds a lot of validity to the notion.

Behind the massive gains are the growing adoption of mobile devices, as well as a population of “unbanked” users that don’t turn to banks for many common needs. Additionally, there’s the social component of Venmo that draws a lot of millennial users into the fold.

Given that the millennials are the generation to reckon with these days in terms of peak spending—the upper tier of Generation X is starting to consider retirement—a development like Venmo is proving valuable on several fronts.

Basically, Venmo makes it easier to send small amounts of cash between users. This makes it useful not only for paying off a bar bet quickly or “getting back” for lunch or the like, but also as a small-scale ecommerce solution for things like farmer’s markets or festival vending.

That it’s actually moving ahead of some of the larger-scales system is only kind of a surprise; for all the name recognition power Apple packs into Apple Pay, it’s still for the most part only usable at a handful of retailers and by a handful of Apple users.

Other devices are a bit more versatile, but much of the mobile payments field right now is business to consumer, or rather consumer to business. There’s not much consumer to consumer going on, and that’s where Venmo truly shines.

With a clear competitive edge and a market that’s not eager to take Venmo on, Venmo will likely be running things in P2P for some time. It’s a shock to see just how much business that really represents.