Rent money is in Venmo limbo
Joshua Hethcoat tries to send $2,000 to his wife to pay rent via Venmo, an online payment system. But something has gone sideways, and now his money is in limbo.
Q: A few weeks ago, I tried to send $2,000 to my wife through Venmo to pay rent. The money didn’t go through. I received a message that my payment “could not be completed.” Venmo closed her account and sent the money back to me. Then it froze my account, and now they won’t give me my money back.
We’re on the verge of being kicked out of our house because we haven’t paid our rent. I have sent Venmo proof of my ID and bank statements many times, but the money is still stuck. Can you help me get my $2,000 back?
— Joshua Hethcoat, San Pedro, California
A: Venmo shouldn’t keep your $2,000. It should have either sent the money to your wife or quickly explained why it couldn’t.
A look at Venmo’s terms makes things clear: When you open a Venmo account, and before your identity has been verified, it applies a $299.99 weekly rolling limit for all transactions combined. So, when you tried to send $2,000 to your wife, it froze your accounts until it could verify your identity.
I think Venmo overreacted. I mean, what’s the point of sending you a “payment could not be completed” message and then suspending your wife’s account? Why not fully explain the problem instead of freezing your account and then subjecting you to a seemingly endless cycle of ID verification requests? You’re probably one of tens of thousands of other flagged accounts, all of which Venmo has to manually review. That takes time — and time is something you don’t have.
Why have spending limits? Venmo, a mobile payment service owned by PayPal, wasn’t really designed for large transactions. It’s meant to send $20 to your buddy, not $2,000 to your wife to pay the rent. And don’t get me wrong, you can do transactions like that once Venmo verifies your identity. But there are probably better ways.
Your case underscores the limits of our banking system. In other countries, sending money is far easier, thanks to more progressive banking regulations. Here in the United States, we still write paper checks — in 2019.
Your problem is a reminder to always check the terms and conditions of any online financial service before using it. If you’d reviewed your Venmo fine print, you wouldn’t have $2,000 in limbo. Ultimately, Venmo did what it normally does with a questionable transaction: It froze the accounts until it could verify everyone’s identity. It just took its time, which almost led to your eviction.
If you ever find yourself in a similar situation, you can always reach out to someone higher up at PayPal. I list the names, numbers and email addresses for PayPal executives on my consumer advocacy site.
That’s exactly what you did. You sent a brief, polite email to one of the executives I list on the site. The company quickly reviewed your account and released your $2,000.