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Do you use Venmo to receive payments for your work? After the new tax rules, maybe not many independent workers are keen on it, but Venmo is still one of the most popular peer-to-peer payment apps. But here’s the thing—Venmo deposits aren’t insured by the Federal Deposit Insurance Corp (FDIC), so if your account is hacked or you sent your money to scammers, you might not see it anymore. It’s crucial to take steps to safeguard your funds there. Let’s dive into some ways to keep your Venmo account secure, with insights from MacPaw’s cybersecurity division, Moonlock.
1. Use security features on your phone
Since Venmo lives on your phone, it’s wise to beef up security on your device. Use Face ID, Touch ID, or a PIN code to lock your phone. Venmo also supports Multi-Factor Authentication (MFA), so make sure to enable it for added protection.
2. Make your account private
Back in 2019, Venmo made headlines for the wrong reason. A researcher scraped millions of public transactions from Venmo’s social feed, revealing how easy it was to misuse this information for extortion and social engineering. Attackers could easily identify a list of people their target frequently interacted with. Also, they could get a clear picture of the target’s spending habits. Making this information available, Venmo unknowingly set the stage for convincing phishing scams.
To steer clear of spear phishing, set your Venmo account to Private. This keeps your transactions, descriptions, and favorite emoji hidden. By doing this, scammers won’t have the details they need to pretend to be your friends and use them as a pretext to ask for money.
2. Don’t share your private information online
Here’s a rule of thumb: don’t share personal information online unless absolutely necessary. While Venmo uses banking-grade encryption, you might accidentally hand over crucial details to hackers. The less they know about you, the better.
If Venmo requests your Social Security Number (SSN) though, it’s legit. All cash apps must comply with the Federal Deposit Insurance Act (FDI) and verify your identity. Just make sure you enter your SSN directly in the app, not through emails or messages.
3. Don’t send money to strangers
Unlike bank deposits, Venmo funds aren’t FDIC-insured, meaning you can’t reverse a payment. So, if you’re unsure who’s on the receiving end, hold off on sending money. Scams involving Facebook Marketplace or “accidental” transfer scams are common, where a stranger claims to have sent you money by mistake and asks for a refund.
4. Link a credit card for chargebacks
Using a credit card with Venmo makes you more in control of your money. Credit cards offer chargeback options, which might help you recover money if you get scammed. However, Venmo charges a 3% fee for credit card transactions, while bank transfers are free.
Your credit card will be safe, even if someone does gain access to your Venmo account. Venmo only shows the last four digits of your linked bank account in the setting, so hackers would be only able to access the funds within Venmo (which we advise to keep in small amounts, too).
5. Open a separate bank account for Venmo
If you’re not keen on linking a credit card, consider opening a separate bank account just for Venmo. Keep a small balance in this account, transferring money in before you use Venmo and out quickly after receiving payments. This way, your main accounts stay protected, and you can still enjoy Venmo’s convenience.
7. Wait for payments to clear
Venmo payments can take some time to clear, especially if sent late in the evening or on weekends when banks are closed. Don’t stop communicating with a client until your deserved check is obviously on your account.
Like any digital tool, Venmo has its perks and risks. If you frequently use cash transfer apps, it’s crucial to understand how they work and how to keep your information—and your money—safe. Moonlock is here to help you navigate Venmo and safeguard your funds. Subscribe to our monthly newsletter to receive updates about recent cash app scams, emerging cyber threats, and tutorials on how to keep your money safe.
