It appears that they take payments in as deposits and then disburse the money when another user requests a withdrawal. This requires either a bank charter or a designation as a money transfer agency. Without one of those, they are running an unlicensed bank. You cannot hold the money as an intermediary in the US without satisfying one of those requirements. I don't see anything on the site about either one of them, but knowing at least a little about the capital requirements needed to get one or both of those I would doubt that they have them. Please correct me if I am wrong, I think mobile payments is an idea who's time is past due but its very difficult to pull off in the US.

I know the guys that make it, and they're solid. Check it out: http://venmo.com

It has been done before, but it hasn't caught on yet in the US. I'm not sure why. It does fine elsewhere - but the configuration is usually through the carrier.

Well, I would trust a notification of a text message than a submission of a form from a potentially phished account. Then the issue is stolen cards, and ramp-up of merchants and payers is a good way to limit risk.

I think this is a user issue. People don't currently pay with there phones. There are a bunch of options for it.

Stolen cards is a huge issue. I actually think being a smaller "Penn students and surrounding businesses" type of play would make it easier...there's less incentive for the online-only stolen card gangs to take over.

Even PayPal has PayPal Mobile: http://www.crunchbase.com/product/paypal-mobile

Venmo has been getting quite a bit of buzz lately in my circles so I'm sure they're on PayPal's radar.

Pretty Cool.

But what happens if you don't have a venmo account and you pay the restaurant and then decide when you get home not to create an account? Do they somehow charge you through your phone bill?

Like most services, you need to be registered and have payment methods set up before you can make payments.

As a first time user, you can actually complete your purchase at the point of purchase. There's no pre-registration required and through texting and a phone call you can add your payment information and notify the restaurant of your payment.

Ah, I didn't realize that you could add payment info from your phone. I'm not sure how safe I'd feel about that.

How does Venmo make money off of this? Do they charge the sender? In the article, a vendor says, "they’re not charging us any transaction fee"