Facebook is enabling its U.S. user base to send money to each other through its Messenger application as the social network pushes forward with peer-to-peer money transactions.
The Menlo Park, California-based company announced on Tuesday that the new feature to its instant messaging service is expected to be released in the U.S. during the coming months, Facebook said on its website. The new addition would be supported by Googles mobile operating system Android, Apples iOS and desktop computers.
The move was not unexpected as the social network hired former Paypal president David Marcus last year and put him in charge of its Messenger unit in order to find new ways of revenue growth. Additionally, Ebay has cut down the employee base of Paypal as the e-commerce giant prepares to spin off its unit later this year. Paypal has been projected to be a juicy takeover target for technology companies.
Facebook is the latest company to join the trend of allowing its users to send money via their services. Last year Twitter struck a partnership with Frances second biggest banking group in order to allow users in the country to tweet money.
Apple also entered the financial sector last year with Apple Pay and Google introduced its own digital wallet, while South Koreas Samsung is expected release a similar service this year. Chinas Tencent also allows peer-to-peer money exchanges through its WeChat application.
Facebooks latest tool would require a Visa or MasterCard issued from a U.S. bank and transactions would be taking effect immediately. However, the company warned that depending on the users bank, the transferred money could take one to three days to be available for withdrawal. Facebook also said it would not charge any fees for the transactions.
Credit card will not be eligible for use for now and it is not certain when the company would allow them as Facebook stressed the importance of security. The company said once users enter their debit card, they would be prompted to create a Pin and iPhone users could utilize the devices Touch ID. Additionally, the company has formed a team of anti-fraud specialists who will monitor for suspicious purchase activity.
Facebook is licensed to handle a range of money transfers in the U.S. and it has been processing payments for game players and advertisers since 2007. Currently the company said it processes more than one million transactions a day.
Facebook gained 1.66% on Tuesday and closed at $79.37 on the NASDAQ, marking a one-year increase of 15.46%. The company is valued at $218.52 billion. On Wednesday the stock edged up 0.49% to $79.75 during pre-market trading.
According to CNN Money, the 46 analysts offering 12-month price forecasts for Facebook have a median target of $91.00, with a high estimate of $107.00 and a low estimate of $65.00. The median estimate represents a 14.66% increase from the last closing price.
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