Facebook is working on a service that enables online transactions. That’s what sources tell the Financial Times. Users could transfer money to others using their Facebook data.
The social networking site is close to getting approval from the central bank of Ireland for the service, according to the Financial Times. If the central bank allows Facebook to become an electronic money institution, the service will be valid throughout Europe through ‘passporting’. That is the right to offer financial services in all EU countries with a single license. According to the sources, users can then use the service to transfer funds to their Facebook account and transfer it to others.
The Financial Times sources also claim that Facebook has held talks with three London start-ups that already provide a platform for international money transfers via the internet and smartphones: TransferWise, Moni Technologies and Azimo. In addition, there are rumors that a co-founder of Azimo has received an offer of 10 million euros to work as director of business development of the service. However, Facebook does not want to confirm this.
By introducing the service, Facebook is competing with PayPal, among others, and hopes to increase its presence in emerging markets. According to someone who says he is familiar with Facebook’s strategy, the network site wants to prove its worth in the developing world. Transfers and virtual transactions would play a crucial role in this. There have been reports of a similar service before.