Scared of recession, millennials are using Venmo to watch their money: PayPal CEO

  • "Mad Money" host Jim Cramer sits down with PayPal CEO Dan Schulman to discuss how younger generations are embracing his company's peer-to-peer payment product.
  • Schulman says that growing up during the 2008 financial crisis has shaped millennials' views of their finances.

Watching the 2008 financial crisis unfold has made younger generations more mindful of their money, PayPal CEO Dan Schulman told CNBC on Wednesday.

"They grew up in a generation where there was a recession, ... and so they want to really take care of their money. They don't want to go into debt," Schulman told "Mad Money" host Jim Cramer. "They think a lot about their financial health, a lot about savings."

Schulman, whose financial technology company owns the popular peer-to-peer payment service Venmo, said that young consumers have embraced the app as a way to split purchases and keep a close eye on their finances.

"It's very important to them if they have their own independence, and these apps like Venmo are incredible powerful in helping and empowering them to take care of their financial health," the CEO said, speaking from CNBC's 1Market in San Francisco.

Schulman cast Venmo as a part of the larger "sharing economy," which has given rise to ride-sharing and home-sharing services like Uber and Airbnb.

The eco-friendly, millennial-driven shift to sharing is emblematic of how younger generations view the world they live in, Schulman said.

"I think there are a couple of things that are really interesting about the millennial generation," Schulman told Cramer. "First of all, they think about equality in different ways. Everyone is the same, everyone is equal, so that sharing happens. They're a part of social networks right now, so their friends are much more important. Experiences are much more important. And the way that they think about technology is very different. So they split everything naturally through their mobile phone."

In December, PayPal announced that it would roll out "Pay With Venmo," a service that allows users to pay with the app at over two million of PayPal's retail partners. The move is part of PayPal's longer term strategy to monetize Venmo.

In the fourth quarter of 2017, Venmo processed $10.4 billion worth of payments, up 86 percent from the fourth quarter of 2016.

Watch Dan Schulman's full interview here:

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