With a beautiful user interface and its social engagements feature as its biggest strengths, Venmo is setting new standards in the Mobile Payment App Industry. It created a social network approach to mobile finance and has redefined how the world sees payments.
Launched in 2011, the app Venmo was purchased by Braintree (the payment processing company for giants like Uber and Airbnb) for $26.2 million. Then, in 2013, when PayPal acquired Braintree, it also got Venmo as a leading player in the P2P market space.
The tag of being from the PayPal family also helped Venmo gain more traction in the market. After this acquisition, its demand grew to an extent that other industry players found its business model hard to beat and attract users to its services.
At present, Venmo is leading the game as the best P2P payment app in the market.
Over 700 million people use Venmo for making payments and the app is making a massive amount of money in revenue, as per a report by BusinessOfApps. It transacted more than $200 billion in payments in 2021 and its annual revenue grew at the highest rate in four years to $850 million during the same year.
Now, if you are planning to make an entry into the mobile payment app market with your own Payment Apps Like Venmo, you have come to the right place. In this article, we will talk everything about developing P2P payment apps and how much it costs to build an app like Venmo. So, let’s get started.
Seeing the strong and fast growth of P2P payment apps like Venmo, Square Payments, and Zelle, if you too are planning to develop a similar solution, now is the right time. Here is why:
1.The COVID-19 Pandemic Made In-Person Banking Look Tedious
The COVID-19 pandemic made physical banking more tedious and has created many new users of digital banking solutions. The year 2020 added new 900 million mobile payment app customers globally, the largest annual increase.
This was mainly because of the pandemic, which forced customers and vendors to not use cash for paying and getting paid in stores.
Now, you must be thinking that this trend was just because of pandemic. What will happen now when life has already returned to normal? No doubt, some people might go back to paying via cash, a lot of people have gotten used to the convenience of paying via mobile apps and they will continue to use this payment method for years to come.
Thus, if you want to take advantage of this new-grown trend, make a move today and invest in building a mobile payment application.
2.The Global P2P Payment Market Will Reach $9,097 Billion by 2030
An increase in the adoption rate of smartphones among consumers in Asia-Pacific nations like China and India is driving the growth of the mobile payment market. In addition, the rise in awareness regarding the benefits of online and mobile payments is further propelling the P2P payment industry to grow with all leaps and bounds.
Furthermore, technologies like AI are expected to increase the demand for mobile payment solutions and apps. These technologies help businesses predict the spending habits of users and make informed business decisions, resulting in more revenues and sales.
3.4 in 5 Americans Used Digital Payment Methods in 2021
As the trend of contactless payments became more prevalent during the pandemic, digital payments skyrocketed and it is showing no signs of slowing down. According to the Digital Payments Consumer Survey by McKinsey, 4 in 5 Americans used digital payments in some form in the year 2021.
This includes in-app or browser-based online payments, in-store checkouts using a QR code, or person-to-person (P2P) payments.
All the above-mentioned statistics show the promising future of the mobile payment industry and why you should invest in developing such an app. Next, in this article, we will talk about how much it would cost to develop a mobile payment app like Venmo, which totally depends on the features you want to add to your own app. So, let’s discuss the features before the cost.
Although the features of a mobile payment app will highly depend on the business model you create, there are some must-have features for such kinds of apps. Let’s discuss the same:
1.P2P Money Transfer
So, this is probably the most important and obvious feature without which your Payment Apps Like Venmo would be useless. First of all, you need to develop a robust money transfer mechanism to let users transfer money to others. Also, it should be fast. People these days are time savvy and when dealing with critical matters like finances, you can not expect them to have patience.
The users of the Venmo app can send money to friends’ accounts and pay bills for different services. However, Venmo is a Standalone App, which means that it has its own mechanism for handling payments and it is not a bank-based solution. You must make an e-wallet within an app if you too want to follow this model. Other types of P2P mobile applications are as follow:
Once you decide what type of P2P app you want to build, it is time to do some research about federal bank norms to comply with all the rules and regulations.
Development Time: 250 hours.
While the app Venmo was originally developed as a tool for payments and digital remittances, the app now also supports payments in online stores as well. But, it is only possible with selected retailers, the ones that have a contract with Venmo.
A special API is implemented by developers for the same. Online shops that meet specific requirements can use it to allow shoppers to make payments via Venmo.
Development Time: 300 hours.
Also Read: How to Start a Financial Technology Company in 2021?
Your app like Venmo must allow users to pay their contacts (friends or family) without requiring their card or bank account numbers. They should be able to select a person from the contact list and pay without requiring their bank details. For this feature, your Venmo-like app will need to access contacts saved on users’ devices.
Venmo app takes this feature one step ahead by accessing users’ contacts from Facebook as well if they permit. It follows a social approach to money management for users.
Development Time: 15 hours.
Simply let your users split the bill payments with their friends and family members added to the app.
Development Time: 15 hours.
Most Payment Apps Like Venmo let their customers request money from individuals. This feature is generally used between colleagues or friends. But, it can be used for other platforms as well. Especially when paying on an eCommerce store.
You get a push message in your application saying that the eCommerce site being referred to has requested a specific amount of cash. Then you can tap on the message and decide to pay to utilize any of your connected bank accounts or digital wallet.
Development Time: 25 hours.
Security is one of the most critical elements behind developing a mobile payment app like Venmo. These apps save a lot of confidential information in one place so hackers are more attracted to such kinds of solutions to steal data.
Moreover, your brand’s reputation will be at stake if things go south. Thus, it is important to make sure your app like Venmo is 100% safe and secure for customers. Here is how you can do that:
Every fintech application must use OTP (One-time password) or Unique IDs before processing any transaction. It helps users verify the transaction twice before the amount gets deducted from their bank account or wallet. For enhanced security, some banking apps even ask for OTPs whenever a user logs in to the application. You can implement this feature using third-party SDKs like Twilio, Firebase, Digimiles, and Nexmo.
You can also add a fingerprint security lock in your app to make sure no unauthorized access occurs. This feature will make sure that only customers who registered for the app can use it. Biometric authentication, capacitive sensors, optical fingerprint, or multi-factor authentication can be used for this feature.
Development Time: 120 hours.
Another way to boost the security of your Venmo-like app is through data encryption. People are very cautious about money, especially when dealing with it online. Every day, a new type of cyber attack comes up and creates panic for all online businesses.
Hence, you should be taking data security very carefully when developing an app like Venmo. There is nothing more essential than data encryption.
Development Time: 100 hours.
While this is not exactly a must-have feature, it is Venmo’s USP. It is not crucial to add this to your Payment Apps Like Venmo unless you are planning to make a Venmo clone. Because copying an app’s idea exactly won’t drive success to your business. Instead, you should be really thinking about your own USP and capitalize on it to make better profits.
The app provides a handy social feature and users can use it to send payment updates to friends and family members. To get the same success as Venmo in the market, think about something that your target market would find interesting and integrate it into your app.
Development Time: 20 hours.
The bottom line is that you need to implement a business model that aligns with your audience to ensure they rush to use your mobile payment app. In addition, you can also add some Advanced Features to your app like the ones mentioned below:
A chatbot is like personal assistance available 24/7 for your app users.
While using the application, an app user might have issues or questions. A chatbot will serve to rapidly determine issues that might emerge while transferring money, making payments, unapproved debits from the wallet, etc.
The value of digital forms of money is growing consistently. As per reports, the cryptocurrency market is anticipated to grow with a CAGR of 56.4% during the period 2019 to 2025. Many organizations permit paying for their services and products in cryptocurrency.
If you plan to develop a cutting-edge application that provides features like this to customers, think about letting users pay in cryptocurrency. But, the development of these features can cost you a fortune. Let’s now talk about the cost of developing an app like Venmo.
Also Read: 8 Top Fintech Apps to Inspire You Build One in 2022
Developing Payment Apps Like Venmo is not an easy task. It would require a lot of knowledge and research of the fintech industry along with the popular trends in the market you are planning to launch your app in.
Fintech applications have sensitive data that customers care about so flawless work with precision and robust security algorithms are required to develop such an app. It will take a lot of effort and time.
The process will of developing a payment application like Venmo will be like this:
Now, that was about the time. The actual cost will also depend on the developers you hire and how much they charge per hour. Your development team can charge you anywhere between $25 per hour and $80 per hour depending on their location, expertise, and team structure.
If we have to find a ballpark number on the cost, let’s say the total number of hours your team would take to complete your project is 1500 hours. Now, the standard charge for developers is $25 per hour. So here is how much it will cost to develop an app like Venmo:
1500 * 25 = $37,500
However, keep in mind that it is just an estimation. The cost of such a project will highly depend on your exact business requirements. If you want to talk about your project to have clarity on the exact cost, reach out to our expert business developers here.
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Nikhil Bansal is the Founder and CEO of Apptunix, a leading Software Development Company helping startups as well as brands in streamlining their business processes with intuitive and powerful mobile apps. After working in the iOS app development industry for more than 10 years, he is now well-equipped with excellent problem-solving and decision-making techniques.
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