Facebook could soon allow Messenger users to send mobile payments to their friends. In fact, the friend-to-friend payment feature is already there. All Facebook has to do is to switch it on for its users.
Stanford University computer science student Andrew Aude uncovered the feature via Cycript, a tool for developers to explore other people's apps, after security researcher Jonathan Zdziarski first hinted at mobile payments on Facebook. Aude says via TechCrunch that the payment mechanism is similar to that used in Square Cash, where Messenger "uses it to debit one account, and then use some magical means to look up the bank account number of the recipient and ACH (Automated Clearing House) deposit it."
@Facebook Messenger has P2P payments coming. @SquareCash style. pic.twitter.com/3NuXuuaMMC
— Andrew Aude (@andyplace2) Oct. 4, 2014
Aude says Facebook's mobile payment system will only use debit cards, as credit cards and bank accounts cost more to transfer funds. He also says Facebook mobile payment feature currently does not charge users but could add a minimal fee in the future.
"Based on my understanding of the debit interchange rates, each transaction will cost Facebook roughly $0.40 to $0.50 (Durbin swipe fee + ACH fee," Aude stated. "The app didn't mention a fee to send, so it's probably free, at least initially. Over time they might add a $1 fee."
Sending money sourced from PayPal is not yet an option, but Aude says he saw code that mentions PayPal, an indication that Facebook could be mulling over incorporating the rival electronic payment system into its new feature. Aude also discovered a note that suggests Facebook will be offering group payments in the future but only friend-to-friend payments are allowed initially. And unlike other aspects of Facebook, the mobile payments system keeps things private, which means no one has access to another user's money transfer activities on Facebook, Aude says.
This isn't the first sign that Facebook is interested in mobile payments. In an earnings call last summer, Facebook founder and CEO Mark Zuckerberg dropped hints that the social network was working on embedding payments with Messenger. However, he also cautioned investors that it could take "years" before Facebook comes out with the right system for its users.
"We're going to take the time to do this in the way that is going to be right," Zuckerberg said at that time.
Prior to Zuckerberg's announcement, Facebook also hired former PayPal President David Marcus, who jumped on board the social network to head the standalone Messenger app, which prompted speculations that Facebook had plans to incorporate the app with mobile payments.
There is no word from Facebook when it will introduce the mobile payments feature, or if it is working on one at all, although Aude thinks the new feature will roll out sometime in the next few months.
