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Venmo launches its first credit card with scannable QR code and personalized cash-back rewards

The Venmo Credit Card is launching to select customers starting today, Oct. 5. Here's everything you need to know about Venmo's first credit card.

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Venmo is expanding its card offerings beyond the Venmo Debit Card to now include the Venmo Credit Card. This marks Venmo's first credit card, which is issued by Synchrony and backed by the Visa network.

"The card gives our customers the same unique Venmo experience they already know and love, in an intuitive, easy-to-use card and rewards program, that's all seamlessly managed and controlled from the Venmo app," Darrell Esch, SVP and GM at Venmo, said in the press release.

Designed for Venmo users, this card has a soft launch, first available to a random percentage of Venmo customers who've had a Venmo account for at least 30 days and who've been active in the last 12 months. If you're selected, you will need to have the latest version of the Venmo app and your account needs to be in good standing. The card is expected to be available to more U.S. Venmo users in the upcoming months.

Venmo customers who are approved for this card can benefit from a cash-back program tailored to the categories they spend the most in, plus easy account management from within the Venmo app.

CNBC Select reviews what you need to know about the unique new card.

New Venmo Credit Card benefits

The Venmo Credit Card offers a unique rewards program that adapts to your spending habits:

  • 3% cash back on the category in which you spend the most
  • 2% back on the second-highest category 
  • 1% back on all other purchases

The first- and second-highest spending categories change each month based on where you spend the most amount of money. There are eight total categories: grocery, dining and nightlife, travel, gas, transportation, bills and utilities, health and beauty, and entertainment.

So you may spend the most on groceries in October, making that your 3% category, but then wind up spending more traveling in November, therefore changing your 3% category to travel.

Throughout the month, you'll be able to see what your top spending categories are and which earn 3% and 2% from the Venmo app. Plus you can view the estimated amount of cash back you've earned so far. The exact amount of cash back will be finalized at the end of the month.

At launch, this card won't have a welcome bonus.

The changing categories may seem similar to a rotating bonus category rewards cards like the Chase Freedom Flex℠ — with 5% cash back on up to $1,500 in combined purchases in bonus categories each quarter you activate, then 1% — but Venmo's structure is different.

With the Venmo card, there's no activation required and you don't need to keep track of bonus categories. Instead, the magic happens behind the scenes to analyze where you spend the most. The algorithm awards 3% and 2% rates accordingly.

Beyond rewards, cardholders can benefit from a clever card design that is printed with a unique QR code on the front. You can scan the QR code to activate the card and friends can also scan it to send you payments from the Venmo app.

This card has no annual fee and new cardholders can receive a temporary account number after approval that allows you to shop instantly before your physical card arrives in the mail. As an added layer of security, if you ever lose or misplace your card, you can freeze the physical card from within the Venmo app and continue to use your virtual card.

Bottom line

The Venmo Credit Card is a unique no-annual-fee offering that provides an intelligent cash-back program. If you want to maximize rewards in two of eight categories without the hassle of activating or figuring out what purchases earn the most rewards, this card is a great choice.

While you may be randomly selected to apply for the new Venmo Credit Card now, that's not the case for everyone. If you're not selected to apply now, the application should be open to more consumers in the upcoming months.

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Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.