Facebook enables peer to peer payments

Facebook Enables Payments Between Friends

Imagine you want to go on a weekend get-a-way with your mates. You start a Facebook group chat to coordinate who wants to join, where to go, where to stay and what to do.

Someone has to book flights, accommodation and some activities, such as a concert.

Wouldn’t it be great if there was an easy way for your friends to send money without going through a bank?

Conversations about money are already happening on Messenger therefore, Facebook thought it would be a cool feature to allow their users to make money transactions seamless and easy too. This is why Facebook is introducing a new payment method via the Facebook Messenger.

“What we want to do is make it easy to finish the conversation in the same place you started. You don’t have to switch to another app,” says Steve Davis, Facebook’s product manager on the new feature.

Convenience is king

In the Facebook Messenger, next to the options to send a photo or sticker, you’ll see a ‘$’ button to send friends money. Facebook will ask the user to enter their payment info (only debit cards –Mastercard and Visa) then with a push of a button, money will be exchanged. The money is instantly taken from the user’s debit card account and delivered to the recipient’s debit account. It may take one to three business days to make the money available to you depending on your bank, just as it does with other deposits.

Apparently, Facebook is testing this for a while (TechCrunch was the first to report Facebook as building peer-to-peer payments into Messenger in October 2014) but has only rolled it out to NYC for now to see how their users would utilise such a functionality.

Once you connect your credit card to Facebook, you can send money seamlessly via the Facebook Messenger both, on mobile as well as on the desktop.


Moving to mobile is important because by 2018 the majority of Internet users will use mobile only.

When you consider Paypal as a desktop application, then this new Facebook Messenger payment function could be the future of how people will make transactions.

Facebook is taking steps to becoming a financial institution

Whether you want to raise funds as a not-for-profit organisation, you want to purchase something from a brand or company on Facebook, or if you just want to have your friends paying the camping trip fee in advance, Facebook Messenger will be the easiest way to do that.

“It’s obviously not a feature you’re going to use 10 times a day,” says Steve Davis. “But when you do need to send money, this is probably going to be the best way to do it.”

Facebook messenger

The fact that Facebook is more relevant now than ever before, they can hit on this big time. It may even become the preferred method of making payments if you think of it on a bigger scale.

If you want to send money internationally these days, you have to pay big international transaction fees. Some countries only operate with certain financial institutions such as Western Union or similar. With the Facebook payment option via Messenger, users won’t need to lean on payment companies at all any longer. And the best thing: Facebook wouldn’t even charge for the transaction.

While other payment providers such as Paypal, BrainTree and Stripe charge a transaction fee, the Facebook payment integration in Messenger will be for free.

The goal is to offer P2P payments for free to make Messenger “more useful, expressive and delightful”, says Davis.

Are Facebook transactions secure?

Facebook is not new in the game of transaction. The social media giant makes approx. 3.59 billon in Q4 alone with ads and games. For extra security, users are prompted to set an in-app payments passcode or Apple TouchID fingerprint to confirm transfers. Alternatively, if the user has already a debit card on file with Facebook from advertising, donating or gaming, they can use that too.

“These payment systems are kept in a secured environment that is separate from other parts of the Facebook network and that receive additional monitoring and control,” from an anti-fraud team.


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