Venmo’s year-over-year total payment volume has grown by almost half more than its parent company PayPal (NASDAQ: PYPL) from the first quarter of 2019 to the first quarter of 2020. Data gathered by Learnbonds.com indicates that Venmo’s volume grew by 47.61% which is at least 2.6 times more compared to PayPal’s 18%.
In the first quarter of 2019, Venmo’s payment volume stood at $21 billion, which grew by 47.61% to $31 billion during a similar period this year. In the second quarter of 2019, the payment volume increased by $3 billion. In the next quarter, the volume grew by 12.5% to $27 billion. By the fourth quarter of last year, the volume stood at $29 billion.
On the other hand, by the first quarter of 2020, PayPal’s payment volume stood at $190.57 billion, a growth of 18% from a similar period last year when the figure stood at $161.49 billion. Notably, 2020’s first-quarter results were a drop from 2019’s fourth-quarter results of $199.4 billion. During the second quarter of last year, PayPal’s payment volume was $172.36 billion which later grew by 3.6% to $178.67 billion in the next quarter. In general, PayPal had six times more in transaction volume compared to Venmo.
More people show interest in Venmo
In this case, transaction volume refers to the total number of transactions processed from, to or through both Venmo and Paypal platforms during the period under review. Notably, both platforms have witnessed an increase in the total payment volume over the last year.
Interestingly, Venmo’s popularity has been growing based on queries logged on the search engine platform Google. By May 2020, the term Venmo had attained the peak popularity of 100 on Google search. The score represents a growth of 9,900% from January 1, 2012. Notably, the interest in Venmo began to rise steadily from March 2013 with minor fluctuations.
The data shows that there was a sharp interest in Venmo from March this year when the popularity score stood at 76. Between March and May, the interest in Venmo grew by 31.6%. Prior to the May spike, there was a notable interest in Venmo in September 2019 when the popularity score was 80.
As of May 2020, the United States was leading in the number of searches related to Venmo with a peak popularity score of 100. Nigeria recorded the second score at 12 followed by Canada with a popularity score of 10.
Notable searches regarding Venmo also originated from Australia (5), United Kingdom (4), Philippines (4), Spain (2), Netherlands (2), Mexico (2), and Germany (1).
The Google trends platform categorizes searches based on popularity scores where a value of 100 is the peak for the term. A value of 50 means that the term is half as popular.
Millennials propel Venmo’s growth
Venmo is a mobile payment service owned by PayPal where users can transfer funds to others through a smartphone app. The platform was launched in 2009 targeting the use case of friends who split bills for movies, dinner, rent, tickets among others. Recipients of transactions can be found through a US registered phone number, Venmo username, and email. Additionally, users can link bank accounts, debit cards, or credit cards, to their Venmo account.
Venmo’s growth has been largely propelled by millennials over the recent years. For example, the platform has become a popular payment method on campuses. According to PayPal CEO Dan Schulman, the Venmo app’s social media-like features allows users to leave a public comment or emoji after every payment that makes it appealing to millennials.
Apart from giving the app more popularity. such features also improve user engagement on the platform. In general, Venmo’s social structure makes the platform a cultural phenomenon, something never witnessed in the payment sector.
The sharp rise in Google searches in Venmo in March correlated with a spike in cases of the Coronavirus in the United States. During the pandemic, authorities have been encouraging people to use cashless payment systems where a platform like Venmo and PayPal are bound to benefit.
At the same time, it will be interesting to see the total transaction volume for both Venmo and Paypal during the second quarter of 2020.