Venmo Credit Card Review: Cash-Back Rewards Get Personal, and Automated

The card offers 3% and 2% bonus categories that can change automatically each month depending on where you spend the most. Those bonus rewards are capped after the first year, though.

Sara RathnerOctober 26, 2020
Many or all of the products featured here are from our partners who compensate us. This may influence which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own.

Our Take

The bottom line: There’s no need to track rewards categories or activate bonuses, making this card an option for anyone seeking a simple way to optimize rewards. But it lacks a sign-up bonus, and the bonus cap in year two and beyond can be limiting.

Venmo Credit Card

Venmo Credit Card

Annual Fee

$0

Regular APR

15.24% - 24.24% Variable APR

Intro APR

N/A

Recommended Credit Score

Quick Facts

Pros & Cons

Pros

  • No annual fee

Cons

  • No intro bonus offer

Alternate Pick: Cash back with a welcome bonus

American Express Blue Cash Preferred Credit Card
NerdWallet rating 

Blue Cash Preferred® Card from American Express

Earn more in popular categories

Earn 6% cash back at U.S. supermarkets on up to $6,000 in spending per year, 6% cash back on select U.S. streaming services, 3% cash back at U.S. gas stations and on transit, and 1% back everywhere else. Limited Time Offer: Earn a $300 statement credit after you spend $3,000 in purchases on your new Card within the first 6 months. Offer Expires 12/10/2020. Terms Apply. The annual fee is $0 intro for the first year, then $95. Terms apply.

Read our review

Compare to Other Cards

NerdWallet rating 
NerdWallet rating 
NerdWallet rating 
Annual Fee

$0

Annual Fee

$0

Annual Fee

$0 intro for the first year, then $95

Regular APR

13.99% - 23.99% Variable APR

Regular APR

11.99% - 22.99% Variable APR

Rates & Fees

Regular APR

13.99% - 23.99% Variable APR

Rates & Fees

Intro APR

0% intro APR on Balance Transfers for 18 months

Intro APR

0% intro APR for 14 months on purchases and balance transfers

Intro APR

0% intro APR on Purchases for 12 months

Recommended Credit Score
Recommended Credit Score
Recommended Credit Score

Get more smart money moves — straight to your inbox

Become a NerdWallet member, and we’ll send you tailored articles we think you’ll love.

Full Review

The Venmo Credit Card breaks away from one-size-fits-all rewards cards, offering extra cash back where you spend the most each month with no need to strategize. Just use the card as you normally would to make purchases, and you’ll automatically earn a higher cash-back rate on your top two spending categories (from a list of eight).

The card also stays true to Venmo’s roots as an app that makes it easy to split costs between friends. Its design features a QR code that others can scan with their phones, so when you front the cost of a restaurant meal with your card, you won’t need to chase anyone down to get paid back.

Of course, if you aren't interested in actually using Venmo, the Venmo Credit Card is not for you. It's also worth noting that there's no sign-up bonus, and extra cash-back earnings are capped after the first year.

At the time of the card’s launch, it was only open to a select group of Venmo users. Within several months, it will be open to applications from all U.S. Venmo account holders.

Venmo Credit Card: The basics

Card type: Cash back.

Annual fee: $0.

Sign-up bonus: None.

Rewards:

  • 3% cash back in your top spending category for the month (from one of eight possible categories).

  • 2% back in your second-place spending category for the month (from one of the remaining seven possible categories).

  • 1% back on all other purchases, including any purchase that doesn’t fall into one of the spending categories listed below.

Spending categories that are eligible for 3% or 2% cash back

  • Grocery: This includes grocery stores and wholesale clubs.

  • Bills and utilities: Phone and internet service providers, streaming services, magazine and newspaper subscriptions, electricity, gas, water, trash disposal and other utilities.

  • Health and beauty: Drugstores, cosmetic stores, health clubs and other membership facilities like tennis, golf and swimming clubs.

  • Gas: Purchases at service stations that sell fuel.

  • Entertainment: Movie theaters, theatrical and concert promoters, video rental and game stores, books and newsstands, amusement parks, music stores, and toy and hobby stores.

  • Dining and nightlife: Dine-in, takeout and delivery from restaurants and fast-food establishments. Bars also are included.

  • Transportation: Rental cars, cabs and ridesharing services, limos, buses, trains, tolls, parking meters and garage parking.

  • Travel: Airlines, hotels and vacation rentals. Also includes resorts, bed and breakfasts, cabins, hostels and timeshares.

Interest rate: The ongoing APR is 15.24% - 24.24%, Variable.

Foreign transaction fees: None.

Minimum redemption requirement: None.

Benefits of the Venmo Credit Card

Personalized rewards across a broad range of categories

The Venmo Credit Card doesn't require opting in or activating bonus categories. You don't really even need to "track" anything. For each monthly billing cycle, you'll simply earn bonus rewards in the top two categories you spend the most on (from the above list), and 1% back on other spending. Once the billing cycle ends, your earning opportunities reset.

Here’s how this could work: Let’s say you booked a trip this month requiring plane tickets and a hotel booking, so you spent the most on travel and would earn 3% cash back on those expenses. Your next highest spending was on bills and utilities, so that earns 2% back. The next month, you go on your trip and dine out often, turning that activity into your 3% cash-back category.

Some business credit cards offer this automated personalization, but it's rare among consumer cards. The HMBradley credit card features it, but you must open an HMBradley deposit account first. The U.S. Bank Cash+™ Visa Signature® Card lets you select spending categories each quarter — but because you must actively choose and track them, it takes more effort.

Easy redemptions

Any cash back you earn will appear in your Venmo balance after your statement closes. From there, you can apply the money toward a credit card bill (much like a statement credit), make purchases from a merchant that accepts Venmo, send money to someone else through the Venmo app or transfer it to a linked bank account or debit card.

Unique card design that makes splitting costs simple

Each physical card features its own QR code on the front, which comes in handy when you’re splitting a purchase with another person. They can scan the QR code from the Venmo app and be brought to your Venmo profile. From there, they can send money, or request money from you. Keep in mind that paying a friend over Venmo using the Venmo Credit Card means you’ll pay a 3% fee, which is the same as using any other credit card for peer-to-peer transactions.

Instant access upon approval

While your physical card is in the mail, you can begin making purchases with the virtual version of the card, which lives within the Venmo app and can also be added to some digital wallets (Apple Pay is a notable exception). Once the physical card arrives, you can activate it by scanning the QR code.

Manage the card on the Venmo app

If you need to pay your balance, see your rewards activity, change notifications, set up autopay, or track your spending trends or transactions, you can do so through the Venmo app. If your physical card is lost or stolen, you can disable it in the app and continue to shop with the virtual card. There’s no separate website to log into. (For some, this may count as a drawback; see below.)

Drawbacks and alternatives

Cash back is capped after the first year

In the first year, the sky’s the limit when it comes to how much extra cash back you can earn. But that doesn't last. In year two and beyond, once you spend $10,000 in your combined 3% and 2% spending categories, all purchases earn 1% cash back for the rest of the year. Depending on your spending habits, you may hit that wall before the year is up.

No welcome bonus

Other cash-back cards sweeten the deal with welcome offers worth $150 or more, which can help offset an annual fee. One example is the Blue Cash Preferred® Card from American Express, which offers this welcome bonus: Limited Time Offer: Earn a $300 statement credit after you spend $3,000 in purchases on your new Card within the first 6 months. Offer Expires 12/10/2020. Terms Apply. The card also earns generous cash-back rates in several common spending categories. The annual fee is $0 intro for the first year, then $95. If that's too high, consider its sibling card, the $0-annual-fee Blue Cash Everyday® Card from American Express. Its rewards are also useful, though less robust. Terms apply.

Many spending categories earn only 1% back

You earn 3% or 2% cash back in only two spending categories per month. Any other spending earns only 1%. If you have a month where you spend a lot at a home improvement store, for example, other cards will reward you more handsomely. However, you could pair the Venmo Credit Card with a flat-rate card like the Citi® Double Cash Card – 18 month BT offer, which earns 2% cash back on all purchases: 1% when you buy, 1% when you pay it back.

Not a starter credit card

While Venmo’s audience skews younger, the Venmo Credit Card requires good to excellent credit to qualify (corresponding to a FICO score of at least 690). A seasoned Venmo user who is still new to building credit may need to set their sights on a starter credit card for now.

You must use it with the Venmo app

There’s no Venmo Credit Card without Venmo. If you have no desire to use the Venmo app and would prefer a more traditional credit card experience, there are other cash-back credit cards that would be a better fit.

Should you get the Venmo Credit Card?

If you already use Venmo and you want an easy-to-manage card with decent ongoing rewards, the Venmo Credit Card could certainly be a contender. The card’s seamless user experience makes it feel like the future of credit cards.

But if you’re after a lucrative sign-up bonus, you have less-than-ideal credit or you have no desire to use Venmo as a payment tool, you'll want to look elsewhere.

See how this card stacks up with NerdWallet's best credit cards to get.

To view rates and fees of the Blue Cash Preferred® Card from American Express, please visit this page.

Comments

NerdWallet reviews are the result of independent research by our editorial team while cardholder reviews are contributions from independent users not affiliated with NerdWallet. Banks, issuers and credit card companies are not responsible for any content posted on the NerdWallet site, nor do they endorse or guarantee any posted comments or reviews.

Write a review

Read Our Posting Guidelines
user avatar
Overall Rating:
Select your rating
undefined reviews

Some of the reviews on the NerdWallet site were purchased through a third party provider. Users who post a review directly on the NerdWallet site will not be compensated in any way. Please see our Terms of Use and Posting Guidelines for more information.