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Digital Wallets Are Here to Stay

Can you trust the technology behind apps like Venmo and Zelle?

Digital wallets VENMO vs. Zelle

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Venmo and Zelle are among the increasingly popular digital wallet apps that allow you to send and receive payments.

A few months ago, I organized a gift (from 30 women) for a friend’s big birthday. So 
I sent an email with the amount owed and my address. Five minutes later, a woman emailed back: “Can I Venmo you?”

Could she? I’d never used the mobile-payment service, but my kids do.
 I downloaded the app, opened an account (in 
no time at all) and sent a second email: “Or, if you’d prefer, you can Venmo me.” I still received checks and cash, but most went the electronic route — and collecting from a large group was never easier.

Venmo is a cash-transferring system sometimes called a digital wallet; it’s owned by PayPal. According to research from, 43 percent of Americans have used a digital wallet in the past year. And those numbers will likely grow with the recent launch of Zelle, from bank-owned Early Warning Services.

Are the systems safe? Generally, yes. Both use state-of-the-art tool s
and encryption to keep your data — and cash transfers — secure. The drawback? Consumers generally spend more money overall with digital wallets than they do with credit cards, debit cards or cash, says the study.

Venmo vs. Zelle

The Platform

Venmo: Operates through the Venmo app you download to your mobile device.

Zelle: Operates through apps of participating banks and credit unions.


How it Works

Venmo: Transferring is easiest if both parties are
on the app. You can “request” or “pay” other users and add
 a note or emoji as the transaction description. You can also send money to family and friends in the U.S. using their cellphone number or email.

Zelle: Users who have accounts at a participating bank can send money to anyone for whom they have a cellphone number or email address. Recipients who don’t bank with Zelle partners can claim their money by signing up at



Venmo: When you “cash
out” the money that friends have paid into your Venmo account, it typically takes 1 to 3 business days to receive your dough.

Zelle: You get your money in minutes (except for the first time; it can take 1 to 3 business days after registration to receive your first payment).



Venmo: Bank transfers and debit card payments: free. Credit card transactions: 3 percent.

Zelle: Partner banks have the right to charge 
a fee for the service, but so far none have done so.

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