Venmo does not offer a savings account or any account that earns interest

Venmo is a payment app designed to move money between people quickly. It holds your balance in a non-interest-bearing account — meaning money you keep in Venmo earns nothing, no matter how long it sits there. Venmo does not have savings features, no interest rates, and no way to grow your balance through the app itself.

If you want your money to earn interest, you need to move it out of Venmo and into a separate savings account at a bank or credit union. That transfer is free and usually takes one to three business days.

Key Takeaways

  • Venmo balances earn zero interest and are not designed for storing money long-term.
  • You can transfer money from Venmo to a linked bank account or savings account for free, though it takes one to three business days.
  • Venmo's purpose is peer-to-peer payment, not wealth building or savings.
  • If you want interest on your money, move it to a high-yield savings account at a bank or credit union instead.

What Venmo is designed to do

Venmo is built for one thing: sending money to friends and splitting bills. You load money in, send it to someone, and they receive it. The app is fast and convenient for that specific use case. But it is not a place to park money you are not using right away.

Think of your Venmo balance like cash in your wallet — it does not grow, it does not earn anything, and it is meant to be spent or moved somewhere else. Keeping large amounts in Venmo is the opposite of what the app is for.

How to move money out of Venmo to earn interest

If you have money sitting in Venmo and want it to earn interest, transfer it to a savings account. The process takes three steps and costs nothing.

First, open Venmo and go to your balance. Tap "Transfer to Bank" (the exact wording varies slightly by phone type). Second, select the bank account you want the money to go to — you must have already linked at least one account to Venmo. Third, enter the amount and confirm. The money leaves Venmo when ready, but it takes one to three business days to land in your bank account.

Once the money is in a savings account, it can earn interest. The rate depends on the bank or credit union you choose. Some high-yield savings accounts currently offer rates between 4% and 5% annually, though rates change frequently and vary by institution.

Why Venmo does not offer interest

Venmo is owned by PayPal, and both companies make money by taking a small cut of transactions — not by holding customer balances. Banks and credit unions, by contrast, lend out the money you deposit and pay you a share of what they earn. That is how interest works.

Venmo's business model does not depend on keeping your money. The company wants you to send it quickly and move on. Offering interest would require Venmo to operate like a bank, which would mean regulatory oversight, insurance requirements, and a different way of making money. Venmo has chosen not to do that.

Other features Venmo offers instead of savings

Venmo does offer a debit card linked to your balance, which lets you spend money directly from the app at stores and ATMs. You can also set up direct deposit so your paycheck lands in Venmo first, then transfer it to your bank account. But neither of these features earns you money — they just make spending and receiving money more convenient.

Venmo also offers a rewards program on certain debit card purchases, but the rewards are small and do not replace the interest you would earn in a savings account. If you are looking for a way to grow your money, Venmo is not the tool.

Where to put money if you want interest

A high-yield savings account at a bank or credit union is the simplest alternative. You can open one online in minutes, link it to Venmo, and transfer money whenever you want. The money is insured by the FDIC (if it is a bank) or NCUA (if it is a credit union) up to $250,000 per account holder.

A money market account works similarly but sometimes offers slightly higher interest rates in exchange for keeping a larger minimum balance. A certificate of deposit (CD) locks your money away for a set time — three months, six months, a year — but pays a higher rate because you cannot touch it early without a penalty.

If you are moving money frequently between Venmo and savings, a high-yield savings account is usually the best fit because there are no restrictions on how often you can transfer.

Frequently Asked Questions

Can I earn interest on money I keep in Venmo?

No. Venmo does not pay interest on any balance, no matter how much money you have or how long you keep it there. If you want interest, you must move the money to a bank or credit union savings account.

Does Venmo charge a fee to transfer money to my bank account?

No, standard transfers to a linked bank account are free. Venmo does offer an when ready transfer option that costs 1% of the amount (with a minimum fee), but the free option takes one to three business days and has no cost.

What happens to my money if Venmo shuts down?

Venmo balances are not FDIC-insured the way bank deposits are. Your money is held by PayPal, and while the company is stable, your balance is not protected by federal deposit insurance. This is another reason not to keep large amounts in Venmo long-term.

Can I set up automatic transfers from Venmo to savings?

Venmo does not have an automatic transfer feature built in. You have to manually transfer money each time. Some banks let you set up automatic transfers from Venmo to your savings account on their end, so check with your bank about that option.