PayPal is counting on its peer-to-peer tool Venmo to drive more use of the company’s digital payments services, with the two operations expected to converge in about a year.
That’s the timing outlook provided by PayPal Senior Vice President Doug Bland, who oversees the company’s consumer services. PayPal absorbed Venmo when it bought Braintree in 2013 (Braintree had acquired Venmo a year earlier), allowing it to draw Venmo’s younger set of users into its PayPal fold.
Giving consumers more ways to segue from their Venmo use to the company’s array of payment options is one of the ways that San Jose-based PayPal is seeking to drive more user engagement overall in its customer accounts. That focus on engagement increased over the past two years as the company fell short of adding more customer accounts.
Speaking at the KBW Fintech Payments Conference last week, Bland spent a lot of time during the presentation talking about how Venmo will be incorporated in and benefit PayPal’s legacy tools and approach.
The company has about 58 million monthly active Venmo users, he noted. In recent years, PayPal has tried to draw Venmo customers into using more services, offering them a credit card and deposit services.
Bland also provided an update on new services PayPal is experimenting with to provide Venmo to teens. Of the approximately 25 million 13- to 17-year-olds in the U.S., about a third have parents who are using Venmo, so PayPal believes there is a significant opportunity to reach the younger consumers, Bland said. As a result, Venmo is setting up a teen service with parental controls, he explained. He didn’t say when that would be available.
PayPal’s merchant clients are seeking to do more with the Venmo users, partly because they not only skew younger, but also higher-income, Bland said. He noted that PayPal is continuing to work with retail giant Amazon on ramping the use of Venmo on that major digital marketplace after an initial roll-out late last year.
The company aims to prompt Venmo users to turn to the app for more spending. “Our customers also say we would like to do more on the Venmo platform — we would like to be able to pay merchants through this,” he said.
Bland also suggested PayPal wants to enhance Venmo’s capabilities with respect to risk and identity verification for providing its credit services. “There are some natural enhancements that you know we can make to further improve the value proposition,” he said, hinting that those are in the offing.