Facebook made a very significant announcement this week. They plan to launch a free money sending service that will be available for use exclusively through the Facebook Messenger application.
There have been rumors that Mark Zuckerberg doesn’t plan to try to make money off of the Facebook Messenger app until its users rise to 1 billion. If that is true, this latest development may be an attempt at winning over more users to the app that many find to be inconvenient since it became a second, separate application on mobile devices some time ago. Whatever the intention, this service looks to be a potential winner among users putting Facebook into even greater direct competition with Snapchat as well as PayPal’s Venmo and Google Wallet.
Facebook is already proficient at handling financial transactions as they process over 1 million transactions per day for advertising, donations, games and Facebook merchant stores. This particular collaboration features a deal exclusively with Visa and Mastercard. Their debit card numbers will be connected to customers’ accounts in order to remove the associated hassle with using banking information online. Only debit cards will be allowed so as not to confuse customers with credit card fees that may be misconstrued as fees for the Facebook money sending service. The service will feature the standard security that comes with the application in addition to added security feature options of the Apple TouchID fingerprint or in-application pass codes.
With just a few simple clicks, Facebook Messenger app users can send funds to friends and family for everything from splitting dinner tabs at dinner to gifting birthday cash. Facebook plans to slowly rollout the service in the U.S. in the next few months. The service will be available for use on desktop computers as well as with mobile devices equipped with iOS or Android operating systems.
While this service is currently targeted to private users only, it is definitely worthwhile for businesses to pay attention to the direction Facebook is heading. There is no reason to believe that Facebook may not offer similar services (although very likely for a fee) for businesses in the future. They’ve already started to experiment with direct to consumer sales with their user-run merchant stores and it’s interesting to see where all of this could end up. As of now, the immediate and apparent benefit is that it is expected that Facebook users in the U.S. may become even more devoted to their favorite social media platform with this new “gift-like” feature.
