Forget About Libra. Meet Facebook Pay.
After the crypto micropayment project Libra was not as warmly welcomed by the world as expected, Facebook is now trying a new thing- Facebook Pay. Just introduced, the new payment service should be a means for Facebook users to send money to other users, to make donations, or to pay in connected online shops (especially in its marketplace).
+++ Facebook’s Libra: The European Commission begin investigation +++
The new payment service for Facebook and Messenger users will be first rolled out in the US, later on, it will be also available in other countries and for users of the two daughter apps Instagram and WhatsApp. Also, in the future, users should be able to pay for videos within Facebook Watch.
MasterCard, Visa, PayPal and Stripe on board
“Facebook Pay is based on existing financial infrastructure and partnerships, and is independent of the Calibra wallet that will run on the Libra network,” said Deborah Liu, VP of Marketplace & Commerce at Facebook. The following however is interesting: Facebook Pay supports exactly the three payment companies – Mastercard, Visa and Paypal – that have recently withdrawn from the Libra Association due to regulatory problems. The transactions are handled, among others, in partnership with Stripe – also a former Libra partner.
The data for the payment services should be stored securely and encrypted. In addition, the sensitive data of users should be protected with biometric systems (Face ID, Fingerprint) so that no one else can trigger payments. The launch is also seen as an attempt of Facebook to make more business in the eCommerce field.
“Facebook Pay is part of our ongoing work to make commerce more convenient, accessible and secure for people on our apps,” says Liu. “We’ll continue to develop Facebook Pay and look for ways to make it even more valuable for people on our apps.”
Data is also used for advertising purposes
Facebook Pay is, of course, also a way for the social network to collect data. “We collect information about the purchase, such as the method of payment, transaction date, invoice, shipping, and contact information,” said Erin Egan, VP and Chief Privacy Officer of Facebook. This data, he admits, can be used to make ad targeting more accurate.
“The actions you take with Facebook Pay can be used to provide you with more relevant content and advertisements, to provide customer support, and promote security and integrity (e.g. to investigate our payment policy violations),” Egan continued , “For example, if you buy a baseball glove on the Facebook marketplace, you may see an ad for a baseball bat.”
However, the merchants would only receive the data necessary to complete the order and delivery (contact details, address). On request, users can also allow promotional emails from shops from which they’ve purchased.