Facebook Messenger: make cash payments to friends using new service

Facebook has launched its in-app Messenger payment system in the UK. Should banks be worried?

You can now make money transfers through the Facebook Messenger app in the UK.

Having already been around since 2015 in the US, the payment service is expected to be used for smaller transfers – most who use it already tend to spend less than $50 (£38).

Put your money in a high-interest current account

How it works

The system is simple to use. When you’re in a chat, press the blue 'plus' button symbol near the bottom of the screen and then hit the green payment button.

On the first payment the app asks for bank information to be entered followed by a payment amount (the biggest payment is £2,500 with a rolling 30-day limit of £10,000).

Your cash will be transferred to your friend within in one to three business days. However, if the friend in question hasn’t set the system up, they’ll be prompted to enter their own card details to get the payment.

There’s no charge to transfer the money and Facebook doesn’t handle cash directly.

The social media giant hopes to get to the point where businesses are able to accept payments using Messenger.

What about security?

For extra peace of mind, a PIN can be set to allow money to be sent but don’t fret, the system is encrypted.

In fact, all debit card credentials are encrypted and protected with bank-level security. Payments are monitored by anti-fraud specialists and as it’s a regulated payment system, you’ll be protected by existing payment rights.

Nonetheless, such news will no doubt see scammers coming up with new tactics to con people, so if you are going to use the service be sure to stay on your guard. 

Putting pressure on the competition

The social network is aiming to make its Messenger app more like China’s main social app, WeChat.

WeChat already has its own payment service where users can make in-store payment, directly split the bill at restaurants, hail and pay for taxis, connect with start-ups and pay utility bills.

Banks may also see this as a threat, drawing customers away from their online banking services.

Sudhesh Giriyan, COO of Xpress Money, said:

“It’s unsurprising to see Facebook expanding its presence in the peer-to-peer payments space, but it should serve as a warning for traditional banks as yet another big technology company builds its customer loyalty and ‘stickiness’ through added payment infrastructure.

“Whilst essentially the new middleman, Facebook is diminishing the role of banks when it comes to their customers sending money, helping to improve their experience.”

Put your money in a high-interest current account