We may have a potential shake-up in mobile payments on our hands. Facebook is reportedly planning to test a mobile payments system — one that would provide payment processing for third-party apps. The system, first reported on by AllThingsD, would allow these third-party apps to integrate with Facebook so users can purchase items if they’ve shared their credit card information with Facebook. AllThingsD contacted Facebook to confirm and, surprisingly, the company confirmed the test would be taking place “in the next month or so.”
Facebook’s first partner for the product will be JackThreads, a male shopping site that offers large discounts on various items daily. The site sells well through mobile, and that makes it a prime candidate to test Facebook’s new system. The big question is, does Facebook have enough credit cards on file to make such a test worthwhile? And will a partnership with just one site, even as a trial, be enough to convince Facebook users who haven’t registered their cards to do so?
Payments are a tough nut to crack — users need to trust that they’re adding their credit card information to a safe system and need to feel like it’ll make their lives easier in some way. We’ll have to wait and see if Facebook can instill that feeling of trust and usefulness in its users. And keep in mind, this isn’t the first time Facebook has tried to involve itself in e-commerce. And those attempts, especially Storefronts, weren’t all that successful.
While AllThingsD’s reporting portrayed Facebook’s push into this market as a challenge to companies like PayPal, Stripe, Amazon and Google’s Wallet product, what really intrigues me about Facebook’s payments system is that it will reportedly work with third-party apps. Will this work on iOS? Would Apple even allow such a thing? While it’s not unprecedented for apps that don’t sell digital goods to use their own payment systems — Amazon, for example — Facebook’s system could potentially be used to bypass Apple’s in-app purchasing system and the 30% cut it takes.
The two companies seem to be working well together right now. Facebook is integrated into iOS and will have ties in Mavericks, too, so I’m not sure Facebook could go out of its way to promote its system for this purpose. And Apple, being the gatekeeper of the App Store, could simply look more closely for apps that try to skate by using Facebook payments instead of Apple’s own in-app purchases, and then block them. It’s something to keep an eye on.
We’ll be watching closely as this story develops further. In the meantime, we’d love to know what you think about potentially paying for your goods using Facebook. Do you trust the company enough to hand your payment information over or will you stick to entering in your own card digits? Leave your thoughts below.