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Facebook testing mobile payments

  • 16 August 2013
  • Written by 
  • Published in Strategy

Facebook is holding nothing back when it comes to mobile, reportedly testing its own payment service for mobile in-app purchases.

According to various reports Zuckerberg's social media giant has paired up with US men's fashion site JackThreads as its first pilot partner, with customers able to access their credit card information stored in their Facebook accounts to make in-app purchases.

There's been no word on whether or not Facebook will expand its pilot test to include more ecommerce partners, or whether it will surely launch publicly in the future.

Facebook described the test as being "very small" and said there was no set schedule for making the service available to users. The service would use payment information that shoppers store on Facebook to automatically complete checkout forms of certain mobile apps, and the app itself would then  process the purchase.

The company iterated that it wouldn't be a rival to existing payment services like PayPal.

Facebook has a "great relationship with PayPal, and this product is simply to test how we can help our app partners provide a more simple commerce experience," Facebook spokeswoman Tera Randall told news website AllThingsD.

The test won't involve moving payment processing "away from an app's current payments provider, such as PayPal," she said.

Meanwhile, Forrester Research analyst Denee Carrington told the website Facebook will face a bit of a trust issue in encouraging users to hand over their credit card details.

"Consumers want safe, seamless and convenient mobile payments and there are a growing number of competitors that consumers trust more - such as PayPal, Visa (V.me) and others," Carrington said.

AllThingsD reported that if the test is successful, Facebook may go further and get involved with payment processing itself, taking on giants like PayPal while collecting valuable shopping data for advertisers.

The news comes as Facebook's share price soars, with investors finally convinced that the company has got its mobile strategy in order.

Earlier efforts, like the Facebook Home app, had been widely panned.

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