Thursday, June 20, 2024

4 explanation why you shouldn’t use Venmo for enterprise transactions


This submit is supplied by our companion, HoneyBook. E-book shoppers, signal contracts, handle initiatives, and receives a commission on HoneyBook, the main clientflow administration platform. Join at present for 50% off your first yr: https://freelancersunion.org/honeybook/

For a few years, Venmo was many independents’ go-to for taking fee in trade for companies. This was as a result of it was one of many solely smartphone-based choices, which is not true. Many apps exist that will let you invoice to your companies. You could be questioning why the app you utilize to obtain fee issues—getting paid is getting paid, proper?

Not fairly. How you might be amassing funds can bolster your earnings or lose you cash to excessive transaction charges, poor professionalism, and an advanced course of. To not point out utilizing the unsuitable fee processing app can clog your money move, leaving you with much less cash to reinvest and develop your corporation.

There are a number of causes to be picky in regards to the platform you utilize for amassing funds. Right here we dive into why utilizing Venmo to course of enterprise funds can lose you cash, shoppers, and progress alternatives. We additionally cowl why an all-in-one clientflow resolution might help you lower your expenses, hold shoppers, and set you up for progress.

What’s fee processing software program?

Cost processing software program permits unbiased enterprise homeowners to simply accept digital funds from shoppers. With a superb fee processing software program, shoppers pays an bill from their desktop, laptop computer, pill, or smartphone, typically on the click on of a button.

The finest fee processors safeguard private info like your identify and your shopper’s identify with encryption. Some examples of fee processing platforms embody HoneyBook, Clover, PayPal, and Venmo. HoneyBook is technically greater than a fee processing platform, however extra on that later.

Why you must cease utilizing Venmo for enterprise transactions

Whether or not you’re simply beginning otherwise you’re working a longtime unbiased enterprise, it’s potential you’ve obtained or despatched a fee via Venmo. Many people have; I’ve taken funds for bartending catering companies via Venmo myself method again within the day. 

There are very, superb explanation why I not do, and certainly one of them boils right down to a narrative.

A caterer’s expertise utilizing Venmo for enterprise

I used to be thrilled when a referral contacted me to make use of my bartending companies at a marriage in a historic lodge. The day got here and the occasion ran easily, up till fee was due. I emailed the bill to my shopper and supplied Venmo, examine, or money as fee choices (I do know, I do know—I wanted a extra streamlined clientflow).

When fee day arrived, the shopper despatched fee—to the unsuitable Venmo account. After many painstaking emails forwards and backwards, a number of hours spent with Venmo’s help group, and speaking to the account holder who obtained the cash, he was capable of ship me the fee for my companies. 

Lesson realized. These are hours my shopper won’t ever get again of their day, and I’m not simply speaking about hours spent with Venmo help. I’m speaking in regards to the hours we spent emailing forwards and backwards, and on the telephone, and on apps, to perform one thing that needs to be an error-free, easy course of: Securely ship an bill and supply click on to pay. Sounds far more skilled, am I proper?

Why utilizing Venmo for enterprise funds is unprofessional

If my story didn’t offer you pause, that’s okay. There are a number of extra explanation why try to be cautious of providing Venmo as a option to settle for on-line funds to your skilled companies. Venmo for enterprise requires so many steps to receives a commission, and we simply can’t think about you having to undergo that.

1. Venmo invoices don’t—and may’t—signify your model

If you happen to’ve ever despatched a pal cash via Venmo, you’re conversant in the format. The blue accents, the gray and white background, and so on. That’s what your shoppers see whenever you request fee via Venmo, too. As a substitute of an expert file that represents your model properly, you’re selling Venmo’s model. Not a superb look because you’ve labored exhausting to align your model in every single place else!

2. Venmo for Enterprise doesn’t supply versatile fee choices

Level clean: Venmo for Enterprise requires your shopper to make use of Venmo. You ship an bill with Venmo for Enterprise, and the shopper has to enroll in Venmo (if you wish to reap the benefits of low charges). In case your shopper pays with a bank card as a substitute of the app, the fee charges greater than double from 1.9% + $0.10 to three.49% + $0.49.

Think about your shoppers. Are all of them tech-savvy? To make your course of as user-friendly as potential, you must supply instruments that everybody can use.

In case your shopper doesn’t use Venmo and also you require it for funds, chances are you’ll lose them earlier than you get the possibility to finish the reserving course of. Venmo merely isn’t a universally passable choice.

3. Rigid transaction charge construction

Each on-line fee platform has transaction charges, however there are lots which have less-than-desirable charge buildings. 

At first, Venmo fee charges for enterprise look interesting at 1.9% + $0.10 per transaction, however the hidden value is within the forms of funds. These low transaction charges solely apply to purchases made throughout the Venmo app or utilizing the QR code.

Your shoppers ought to be capable of pay nonetheless they need with out it coming again on you financially. HoneyBook’s fee processing charges are designed to compete with main bank card processing apps like PayPal. 

And so they do: HoneyBook’s bank card processing for entered funds is 0.09% + $0.24 lower than PayPal’s bank card processing charge. Right here’s a breakdown of all HoneyBook’s transaction charges:

Cardholder
Entered
Card on File ACH Funds (obtained from shoppers) Prompt Deposit (non-obligatory service for switch of obtained funds)
2.9% + 25¢ 3.4% + 9¢ 1.5% Extra 1%

After which, there’s Venmo: whereas that 1.9% + $0.10 appears interesting, keep in mind it’s solely for Venmo to Venmo transactions, and Venmo isn’t a most well-liked fee methodology for shoppers. The charge for the popular transaction methodology, bank cards, shoots as much as 3.49% + $0.49—that’s 0.59% + $0.24 greater than a one-time bank card cost utilizing HoneyBook’s fee platform and 0.09% + $0.40 greater than HoneyBook’s card on file charge for autopay.

And do not forget that after you obtain a fee via Venmo, you need to manually switch it to your checking account in batches, too.

4. Your cash doesn’t go immediately into your checking account

When you receives a commission on Venmo, the funds don’t go immediately into your checking account. Unusual, proper? You must go in and manually switch cash out of your account, making for a money move nightmare.

You probably have a enterprise credit score or debit card separate out of your Venmo account that you simply use for enterprise purchases, transferring money from Venmo to your corporation checking account provides yet another step when it’s essential entry your cash. 

Moreover, immediate transfers value 1.75% of the quantity transferred with a minimal of $0.25. Payment-less transfers can take one to 3 enterprise days. 

Not solely that however there’s a $5,000 cap per switch. Meaning in case your shopper paid you $6,000 to your companies, you need to manually switch $5,000, then manually switch $1,000, then await as much as three days to obtain your hard-earned money. Additionally, that is provided that you’ve verified your identification. If you happen to haven’t, you’ll be able to solely switch $999.99.

Use an all-in-one clientflow administration platform with fee processing as a substitute

As a substitute of utilizing Venmo for enterprise transactions, we advocate utilizing a clientflow administration platform as a substitute.

What’s a clientflow administration platform?

A clientflow administration platform gives fee processing and far more. As a substitute of utilizing Venmo, PDF invoices, scheduling apps, Gcal, and lots of extra instruments–you’ll be able to lastly have every part in a single place to handle your corporation extra effectively. 

HoneyBook is a clientflow administration platform that permits unbiased enterprise homeowners to handle the whole means of promoting and delivering their companies to shoppers. From the second an inquiry reaches out in your contact kind, you’ll be able to seize them as a lead and automate a follow-up e-mail, serving to you get again to them first and making them extra possible to decide on your corporation. 

In case your lead is an efficient match, you’ll be able to simply transfer ahead with reserving by sending an bill that features fee processing. As quickly as your shopper is able to transfer ahead, they’ll be capable of view the bill and pay in a single step. You may even customise your information to incorporate contracts so your complete reserving course of is taken care of in a single step. 

Much less trouble on each the shopper and unbiased sides and fast and straightforward fee assortment offer you extra time again in your day to concentrate on working your corporation. Quick, straightforward funds enhance your money move so you could have the sources it’s essential scale.

HoneyBook makes it straightforward to ship branded invoices and take funds

We’re not simply speaking in regards to the potential so as to add your brand. We’re speaking full-blown customization. High graphic for a header, your identify, brand, and customized companies. You’ve labored exhausting in your branding and it’s one of many some ways your shoppers will always remember you.

A scrolling gif featuring an invoice template through HoneyBook.

With HoneyBook’s bill templates, you’ll be able to ship personalized invoices straight from the HoneyBook app. Moreover, our sensible information will let you hyperlink service choice, invoicing, and fee all in the identical file, automating your whole reserving course of so you will get to work on the deliverables.

With HoneyBook you leverage each greenback you earn for enterprise progress

At HoneyBook, we consider in empowering unbiased enterprise homeowners to construct a lifetime of ardour and objective. Meaning we prioritize getting each greenback your shoppers pay you into your checking account stat. We additionally advocate for submitting your taxes and leveraging each write-off that is sensible to your unbiased enterprise.

As a substitute, in the event you earned over $20,000 and processed 200 funds in a single yr, we ship you an digital 1099-Okay. That’s it. You’ve gotten all of your money so you’ll be able to reinvest in your corporation and write off new instruments, and we ship you what it’s essential report correctly.

If you happen to transacted underneath $20,000 in a yr or processed lower than 200 funds, you don’t should be looking out for any paperwork from us. You’ll work along with your accountant to do your personal reporting, and you may obtain your HoneyBook analytics studies for month-to-month or yearly overviews of your money move. 

Thankfully, whether or not you transact over $20k with 200 funds yearly or not, HoneyBook’s QuickBooks integration makes tax time straightforward yearly.

HoneyBook additionally gives a devoted disputes group to help with any and all chargebacks. We wish you to receives a commission, and we imply that. Our disputes group is right here to stroll you thru unethical refund requests so you retain your money move constant.

Receives a commission rapidly with skilled invoices and low transaction charges, each time.

HoneyBook’s clientflow administration platform is particularly designed for unbiased enterprise homeowners to handle each step of the clientflow, from onboarding to service supply to referral. With HoneyBook, you get attorney-drafted contracts, customizable invoicing, top-notch fee processing, and undertaking administration instruments multi functional place. 

Venmo originated as a peer-to-peer fee platform. It’s primarily used for sending cash between people—splitting payments, paying buddies again, and different informal transactions—however we don’t advocate it for enterprise transactions.

With HoneyBook, getting paid is straightforward. Study extra and get 50% off your plan plus a free Freelancers Union contract template right here.

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