Venmo, the eponymous P2P solution grew to its current strength in part due to the links it had to social media. This allowed users to surround their payments with comments and emojis which help to build the massive network of users. With all the attention being given to “big tech” and privacy concerns these days, Venmo is getting criticized for the lack of privacy the social connection has created. An article in Wired took Venmo to task:
When I opened Venmo recently, the first payment on my news feed was from a friend whose concerns about privacy have led him to delete both his Instagram and Facebook accounts. Despite taking drastic steps to limit his digital footprint, I know who he ate sushi with last night, thanks to Venmo.
Venmo’s insistence on mimicking a social networking app isn’t just weird—it can have unnerving consequences. In July, privacy advocate and designer Hang Do Thi Duc released Public by Default, a site that taps into Venmo’s API to highlight how much information can be gathered about you from your public activity on the app. She was able to trace the exact spending habits of a couple in California, documenting what stores they shopped at, when they took their dog to the vet, and when they made loan payments.
The writer went so far as to suggest to readers that they consider other P2P apps.
The issue of privacy around P2P transactions has dogged Venmo, including a complaint by the FTC which has been looking into Venmo practices for years:
The FTC said Venmo didn’t make it clear that users needed to change multiple settings in order to make their transactions truly hidden. The agency said the app also failed to disclose that one party in a transaction could retroactively change the privacy settings the other person set for the exchange. Venmo now includes a privacy tutorial pop-up for all new users, according to a spokesperson for the company.
Despite the attention this issue has been given, millions of consumers are continuing to skip the privacy settings and share their payment details.
Overview by Sarah Grotta, Director, Debit and Alternative Products Advisory Service at Mercator Advisory Group