Venmo (PYPL) has come a long way since it was created in 2009 by two University of Pennsylvania students trying to split their frozen yogurt tab.

The peer-to-peer money app, which PayPal bought in 2013, is now a part of many people’s economic lives.

According to CNBC, PayPal told investors in New York on Tuesday that Venmo’s revenue could top $2 billion by 2027. PayPal stock has been rising today as the company generally paints a positive outlook during their first “Investors Day” conference since 2021.

Venmo has moved aggressively into the retail check-out space, often partnering with retailers that haven’t used it. Recently, for example, JetBlue became the first airline to offer Venmo as an option.

This past holiday season, Venmo enticed Cyber Monday shoppers with 25% off TikTok Shop purchases if they paid out of their Venmo account. It’s just one example of how PayPal has made Venmo more visible in recent months. The company calls the Venmo check-out option “Pay with Venmo.”

Sameer Kulkarny, vice president of sales, banking, and financial services at digital engineering company, Encora, said Venmo is well-positioned to keep growing.

“With over 90 million users already familiar with Venmo’s peer-to-peer functionality, it has established cultural relevance, which gives it a strong foundation for expansion,” Kulkarny said, but he added that success in the competitive digital payments space will depend on Venmo’s ability to deliver a seamless, unified financial experience that adds value beyond basic transactions.

Kulkarny notes that by integrating with DoorDash (DASH), Starbucks (SBUX), JetBlue (JBLU) and others, Venmo is already creating an ecosystem that reduces friction across consumer touchpoints.

“A dominant Venmo would mean simplified financial management, seamless transactions, greater visibility into spending patterns, and potentially more innovative financial tools for customers,” Kulkarny said, adding that the ability to move money between Venmo and traditional bank accounts eliminates a barrier that many digital payment solutions face.

“Possible integration with payroll providers could further cement Venmo’s position in users’ financial lives,” Kulkarny said.

Still, the company faces challenges. The landscape in the digital payments space is competitive, and Venmo needs to navigate several challenges to capitalize on the opportunity.

“First, trust and security become even more fundamental as Venmo expands its financial services. Any breach could undermine consumer confidence,” Kulkarny said.

But one of the biggest barriers could be that Venmo will have to clearly articulate why users should keep funds in their ecosystem rather than traditional banking accounts. And the whole experience, as Venmo expands, will have to stay seamless to keep customers.

“Venmo will need to ensure its checkout solution feels integrated rather than an extra step,” Kulkarny said.

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