Venmo’s ‘Preferred Payment for Business’ Error: What to Do

Venmo is a widely used digital payment platform, simplifying transactions between individuals and businesses. While generally efficient, users may occasionally encounter specific error messages that can cause confusion. This article aims to clarify a common Venmo error message related to payment methods for businesses and provide practical solutions to help users complete their transactions.

Understanding the Error Message

The error message, “this is a preferred payment method for connected businesses,” indicates that the chosen funding source is not aligned with the business’s preferences or accepted methods on Venmo. This often relates to the costs associated with processing different payment types.

“Connected businesses” refers to Venmo Business Profiles. These business profiles are designed for merchants to accept payments for goods and services. If a payment method does not appear as an option during checkout, it signifies that the business cannot accept that particular method due to its settings or network limitations.

Primary Reasons for the Error

One primary reason for this error involves the use of credit cards for business transactions. While Venmo users are generally exempt from a direct 3% fee when paying a business profile with a credit card, the business itself incurs a processing fee. Venmo charges businesses a standard seller transaction fee of 1.9% plus $0.10. Businesses often prefer payments via bank accounts, debit cards, or Venmo balances because these methods typically result in lower processing costs for them.

Another underlying cause stems from the distinction between personal and business transactions on Venmo. Personal accounts are not intended for commercial activities, and using them for business transactions can lead to service violations. Businesses utilize specialized profiles that come with features like tax reporting and specific payment acceptance rules to manage their transaction costs effectively.

Sometimes, the error can be attributed to more general funding source issues. If the linked bank account or debit card selected for the payment has insufficient funds, has expired, or is experiencing technical connectivity problems, a generic payment error may occur. Account verification issues or outdated banking information can also contribute to these difficulties. Users should ensure their linked payment methods are current and valid.

The configuration of the business’s Venmo account can also play a role. Businesses using Venmo Business Profiles have the ability to set specific limitations on which payment methods they will accept. These settings are often implemented to manage operational costs or comply with internal policies. If the business has restricted certain payment types, the error message will appear when a customer attempts to use a prohibited method.

Steps to Resolve the Payment Issue

When encountering this payment error, a straightforward solution is to change the payment method within the Venmo application. Users can switch their funding source during the payment process, moving from a credit card to a linked bank account, debit card, or their Venmo balance. Venmo prioritizes using any available Venmo balance first; if the balance is insufficient, it will then attempt to charge the preferred linked payment method. Users can adjust their default preferred payment method in their Venmo settings.

It is also advisable to verify the status of your Venmo balance and linked accounts. Confirm that your Venmo balance is sufficient for the transaction, or that your linked bank account or debit card is active and holds adequate funds. If a bank account has become disconnected or an error message indicates a lost connection, deleting and re-adding the bank account within the app might resolve the issue, though manual verification can take a few business days.

Communicating directly with the business you are attempting to pay can provide immediate clarity. The business may be able to explain their preferred Venmo payment methods or offer an alternative payment solution outside the Venmo platform. They might also provide insights into specific reasons why your chosen payment method is not being accepted on their end.

If the issue persists after attempting these steps, contacting Venmo’s customer support team is the next course of action. Venmo provides support through its in-app chat feature, accessible by navigating to “Me,” then “Settings,” and selecting “Get Help” followed by “Chat With Us.” For complex or persistent problems, direct phone support is also available, ensuring more specific account-related assistance.