"I'll Venmo You Later" — Why It Never Happens

Every IOU has a half-life. 44% of informal loans between friends are never fully repaid—and "I'll get you next time" almost never works.

The science of forgetting

In 1885, German psychologist Hermann Ebbinghaus conducted one of the most famous experiments in the history of psychology. He memorized lists of nonsense syllables—made-up words like “DAX” and “BUP”—and then tested himself on them at increasing intervals.

His discovery, now known as the Ebbinghaus Forgetting Curve, revealed something striking about human memory:

56%forgotten within 1 hour

66%forgotten within 24 hours

75%forgotten within 6 days

79%forgotten within 31 days

Memory doesn’t fade gradually—it collapses rapidly, then levels off. Most forgetting happens in the first few hours.

The relevance to “I’ll Venmo you later” is direct. That split you calculated at 9:47 PM on Saturday? By Sunday morning, the details are already fuzzy. By next weekend, they’re gone.

Ebbinghaus demonstrated that the speed of forgetting depends on factors including the meaningfulness of the material and the conditions of learning. Routine, unmemorable information—like restaurant bill amounts—decays fastest.

Restaurant bills aren’t distinctive. They’re routine. Forgettable. The exact items, who ordered what, the precise amounts—all of it dissolves into “roughly $40, I think?” within a day.

Source: Memory: A Contribution to Experimental Psychology, Hermann Ebbinghaus, 1885

The IOU decay rate

Memory is only half the problem. Even when people remember they owe you money, they still don’t pay. The behavioral economics literature explains why.

Research on informal lending—money between friends and family—reveals a stark pattern:

 44%of informal loans to family members are never fully repaid,

according to a FinanceBuzz survey of 1,000 U.S. adults. 

This isn’t about bad friends. It’s about how the human brain handles delayed obligations. Hyperbolic discounting—documented by Laibson (1997)—means the longer the delay, the less likely repayment becomes:

The delay problem: A $32 debt that feels urgent tonight feels trivial by tomorrow. Each passing day increases the psychological distance between the promise and the action—making “I’ll get you later” progressively less likely to happen. A Bankrate survey found 37% of respondents lost money after lending cash to a friend or family member.

The Federal Reserve Board’s Survey of Consumer Finances estimates Americans engage in $89 billion worth of informal lending annually. With default rates near 44%, that’s a staggering amount of unrecovered debt.

“I’ll get you next time” isn’t a promise. It’s a statistical improbability. And if someone in your group is keeping a mental tally of these unpaid debts, they’re doing it with a tool—memory—that’s biased in their own favor.

Sources: FinanceBuzz Family Lending Survey, 2024; Bankrate Lending Money Survey, 2019; Federal Reserve Board Survey of Consumer Finances

Why we procrastinate on payment

In 2007, psychologist Piers Steel published a landmark meta-analysis of procrastination research—synthesizing 691 correlations. His Temporal Motivation Theory explains exactly why “Venmo you later” fails.

The theory identifies four factors that determine whether we act:

Motivation = (Expectancy × Value) / (Impulsiveness × Delay)

Let’s apply this to paying back a dinner tab:

Expectancy

Low. You’ve said “I’ll Venmo you” dozens of times. So has everyone else. The social expectation that it’ll actually happen is weak.

Value

Low. Paying $32 doesn’t feel rewarding. There’s no dopamine hit for repaying a debt. It’s pure obligation.

Impulsiveness

High. Your phone is full of more interesting notifications. Instagram, texts, games—all more immediately gratifying than opening Venmo.

Delay

Increasing. This is the killer. The longer you wait, the bigger the denominator gets. Each passing day makes action less likely.

The math is brutal. A task with low value, low expectancy, high impulsiveness, and increasing delay has essentially zero motivation force. “Later” becomes “never.”

Steel’s key insight: procrastination isn’t laziness. It’s a predictable failure of temporal motivation—when a task is aversive, delayed, and competing with immediate gratifications, the brain simply won’t prioritize it. The equation predicts it; repaying dinner IOUs confirms it.

Paying someone back creates mild negative emotion (loss aversion), offers no reward, and has no immediate deadline. It’s the perfect storm for procrastination.

Source: The Nature of Procrastination, Piers Steel, Psychological Bulletin, 2007

Your brain hates future payments

Even deeper than procrastination is a cognitive bias called hyperbolic discounting. Documented by economist David Laibson in his influential 1997 paper, it explains why we systematically undervalue future actions.

The standard economic model assumes people discount the future exponentially—like compound interest in reverse. But that’s not how humans actually behave.

$100today feels like $100

$100tomorrow feels like $80

$100next week feels like $60

The curve is hyperbolic, not linear. The drop from “now” to “soon” is massive. After that, it flattens out—$100 next week and $100 next month feel almost the same.

This creates a cruel asymmetry for IOUs:

When you agree to pay later: Future $32 feels like ~$20. Easy to promise.
When “later” becomes “now”: $32 feels like $32 again. Painful to pay.

The person who says “I’ll Venmo you later” genuinely intends to. They’re not lying. They’re just experiencing a predictable cognitive distortion that makes future payment feel trivially easy.

Researchers O’Donoghue and Rabin coined the term “present-biased preferences” to describe this. When the future becomes the present, we discover our past selves made commitments our current selves don’t want to honor.

Sources: Laibson, QJE, 1997; O’Donoghue & Rabin, QJE, 1999

The mental accounting loophole

Richard Thaler won the Nobel Prize in Economics for documenting how humans actually think about money. His work on mental accounting explains why unpaid IOUs persist.

We don’t have one pool of money. We have mental buckets: rent, groceries, entertainment, savings. Money in one bucket doesn’t easily flow to another.

Here’s the problem with “I’ll Venmo you later”:

At the restaurant: The dinner came from your “dining out” budget. That bucket is already closed for the night.

At home: Paying you back feels like it should come from… where? There’s no “repaying friends” bucket. So the money stays in limbo.

Prelec and Loewenstein (1998) formalized this as “coupling”—the degree to which consumption calls to mind thoughts of payment, and vice versa. Cash creates tight coupling. IOUs create almost none.

Coupling matters: When payment is temporally separated from consumption, the pain of paying is dulled. The meal is already enjoyed; the cost floats untethered. Prelec and Loewenstein showed that this decoupling is precisely why credit feels “cheaper” than cash—and why IOUs feel like free money until it’s time to pay.

When someone promises to “Venmo you later,” they’ve experienced the benefit (the meal) but decoupled the cost (the payment). Psychologically, that cost floats in uncertainty—easy to defer, easy to forget, easy to never resolve.

Sources: Mental Accounting Matters, Richard Thaler, 1999; The Red and the Black, Prelec & Loewenstein, Marketing Science, 1998

Good intentions, poor execution

Social psychologist Peter Gollwitzer documented what he called the intention-action gap: the chasm between planning to do something and actually doing it.

A meta-analysis by Sheeran (2002) across 422 studies found that intentions alone predict only about 28% of variance in behavior. Saying “I intend to pay you back” barely moves the needle.

What does work? Implementation intentions—specific plans that specify when, where, and how. “I will pay you $32.47 on Venmo right now” succeeds. “I’ll get you later” doesn’t.

28%of behavior variance explained by intentions alone

d = 0.65medium-to-large effect of implementation intentions

94studies confirming the effect (Gollwitzer & Sheeran, 2006)

The difference is specificity. “Later” is not specific. “Now, at this table, for this exact amount” is specific. And specific actions actually happen.

Gollwitzer’s core finding: implementation intentions delegate control of goal-directed responses to anticipated situational cues. When the specified cue is encountered, the planned response is triggered automatically—without further conscious deliberation.

Sources: Implementation Intentions, Gollwitzer, American Psychologist, 1999; Sheeran, European Review of Social Psychology, 2002; Gollwitzer & Sheeran, Advances in Experimental Social Psychology, 2006

The social cost of asking twice

Even if someone forgets to pay you, you probably won’t remind them. Why? The social friction of asking for money is often greater than the money itself.

Research on payment reminders shows that people will forfeit significant amounts rather than make a follow-up request. The awkwardness of “hey, you still owe me from Saturday” outweighs the $30.

The asymmetry of asking: The person who covered the bill pays twice—once with money, once with social discomfort. The person who owes pays nothing… and might not even realize they’ve extracted a cost.

This creates a perverse equilibrium. The person least likely to forget (the one who’s owed) is also the person least likely to bring it up. The friction of reminding exceeds the friction of absorbing the loss.

Over time, the generous friend becomes the subsidizing friend. They quietly cover $20 here, $35 there, until they stop volunteering to put things on their card.

This tension has sparked a cultural backlash. Viral discussions on TikTok and Twitter describe the “constant Venmo-ing each other over little things” culture as “a little dystopian”—where friendships become transactional ledgers. But the alternative (silently absorbing costs, or awkwardly chasing payments) is worse.

The real solution isn’t to stop settling up. It’s to settle up immediately, while everyone’s together, so debt never becomes a lingering social liability.

The real numbers

Let’s be concrete. Assume you split dinner with friends twice a month, and 44% of those IOUs never get fully paid (per the FinanceBuzz family lending survey).

The annual math:
24 dinners × $35 average IOU × 44% default rate = $370/year lost

That’s real money. A plane ticket. A nice dinner for two. A year of streaming subscriptions. Gone—not because your friends are bad people, but because human memory and motivation don’t work the way we think they do.

$370lost annually to unpaid IOUs

24dinners per year (2/month)

44%of informal loans never repaid

$89Bannual informal lending in US

And that doesn’t account for the partial payments, the rounded-down amounts, or the resentment that accumulates silently. The financial cost is measurable. The social cost isn’t.

The obvious solution

Every cognitive bias working against “Venmo you later” has one common cure: immediacy.

Beat the forgetting curve

Settle while everyone's still at the table. The itemized receipt is right there. The amounts are fresh. No one has to remember anything.

Defeat hyperbolic discounting

"Now" doesn't get discounted. When payment happens immediately, $32 feels like $32—not some vague future obligation that weighs less in the mind.

Create implementation intentions

"Pay $32.47 to Alex right now" is specific. It happens. "I'll get you later" is vague. It doesn't.

Eliminate social friction

When everyone sees the split at the same time, there's no awkward reminder. No second ask. The payment request is part of the dinner, not a follow-up.

From research to design

splitty is built specifically to overcome these documented psychological barriers. Every feature maps to a research finding:

Memory decays 66% in 24 hours→Receipt scanning captures details immediately

44% of informal loans go unpaid→Payment requests sent at the table

Intentions explain only 28% of behavior→Specific amounts, one-tap payment links

Reminding is socially costly→App does the asking, not you

The goal isn’t to nag your friends into paying. It’s to eliminate the need for nagging entirely—by making immediate settlement the natural, frictionless default.

Skip "later." Settle now.

Because every IOU has a half-life.