Facebook Will Introduce Smartphone Payment App
| published March 18, 2015 |

By Thursday Review staff

 

Facebook is about to expand its footprint among users by entering into the business of sending/receiving payments, and by enabling payments between its users through its popular Messenger function.

Facebook hopes to channel the rapidly-expanding spending and payment preferences of millions of people using smartphones, iPads and other handheld devices into its arena of activity, a move which will allow the California-based company to compete with other providers of wireless and non-traditional payments—such as Apple, Google, Amazon, Snapchat, and Bitcoin.

Facebook says it will create a single touch phone icon which its hundreds of millions of U.S. users can simply tap in order to send or receive cash transactions. At first, the payment system will use customers’ debit card or credit card information, but analysts say that it may only be a matter of time before Facebook creates its own form of digital currency for its online cash transactions.

For now, users of the new Facebook payment app will simply provide a credit card or debit card number, then, create a PIN code. Security experts and critics were quick to point out that such a system will be fraught with opportunity for hackers or criminals, but Facebook says those concerns are misguided, and it points to its ability to handle the payments and transactions of millions of users every day—many of whom are video gamer players or businesses who advertise or promote products using Facebook.

If the payment option works well in the United States, the company says it will expand the operation to include most foreign markets.

Privacy advocates—many of whom already worry about the amount of information people share via Facebook—have expressed skepticism that Facebook will be able to fully protect users of its new payment application from the prying eyes of hackers and criminals. But other analysts say that with more and more user activities moving to mobile devices—from shopping to bill payments to account management—it is only a matter of time before the majority of financial transactions by individuals are flowing though wireless applications.

The amount of data Facebook collects about its billion-plus users has given it the sort of unique insights that marketers greatly desire. Facebook is working with large data mining and data analysis companies to provide marketers with closer insights into brands, name-recognition, social preferences, even political trends, based entirely on the mountains of data it is able to harvest every day. Companies and service can monitor their own brand identity and brand effectiveness by watching trends on Facebook.

Related Thursday Review articles:

The Really BIG Apple; Thursday Review staff; Thursday Review; January 29, 2015.

Is the Smart Watch the Next Big Thing?; Thursday Review; March 12, 2015.