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Wednesday, April 1, 2020

Facebook Launches Digital Payment Service

Facebook has launched Facebook Pay, a digital payment service similar to Amazon Pay. However, given its wide-scale and reach, Facebook is offering many services.

The company owns WhatsApp and Instagram and has linked the payment service with both, along with its Messenger service. You can simply link your debit card to make a payment on these services.

At launch, the service will let users pay for fundraisers, person-to-person payments, in-game purchases and some pages on Facebook marketplace.

Deborah Liu, Vice-President, Facebook Marketplace and Commerce has stated in a press release, “Today we’re introducing Facebook Pay, which will provide people with a convenient, secure and consistent payment experience across Facebook, Messenger, Instagram, and WhatsApp. People already use payments across our apps to shop, donate to causes and send money to each other. Facebook Pay will make these transactions easier while continuing to ensure your payment information is secure and protected.”

The company has been testing WhatsApp Pay for more than an year in India. But, it has contentious issues with the country’s central bank over data localisation norms. In the US, it’s competition is wide-ranging – services such as Google Pay, Square, Venmo and the recently launched Apple Pay.

It remains to be seen how much trust users will have in making payments using Facebook. The company has been accused of being negligent with data – the Cambridge Analytica case is not so old. One of the research firms associated with data collection was found to be working towards influencing elections in countries such as Sri Lanka.

A point in its favour is that Instagram and WhatsApp is being long used to publicise products. This allows people to directly purchase and pay, which maybe is more convenient. It may also help people send money to family members.

What remains to be seen is how secure this financial system is. Will it also link back to Facebook’s proposed cryptocurrency, Libra? That remains to be seen.

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