Facebook payment function: Industry analysis and opinion

Facebook is to introduce a function that allows its one billion users to send money to friends.

According to the New York Times, American users of the Facebook Messenger app will be able to link their debit cards to the service, and use it to message money to one another just as easily as they can send an image or text.

Analysts said that if the payment system succeeded, Facebook would extend it to other types of purchases, such as consumers’ buying of products directly from advertisers, whilst there were other concerns that Facebook could use this as a back door to get people’s debit cards.

It’s nothing new, as Chinese social network WeChat already allows users to send money via instant message, but as messaging has begun to eclipse email as the preferred form of electronic communication, especially among younger users, Facebook has sought to dominate that market much as it dominates social networking.

Is this a security nightmare waiting to happen, or proof of Facebook’s commitment to security and revolutionary techniques? We asked some experts.

Mark Kraynak, chief product officer at Imperva

“The security scenario seems to be most similar to PayPal. The main risk I see for users is that someone will take over their Facebook account and be able to transfer money. I would recommend using the additional transfer authentication features that Facebook offers.

“There’s been a lot of talk recently about increased fraud via Apple Pay and this offering doesn’t seem to be subject to the same issues (which is that fraudsters in possession of a stolen card number can abuse it via Apple Pay). I think the main impact of this offering isn’t security, but that Facebook will undercut Paypal on fees.”

Kevin Dallas, chief marketing officer at Worldpay eCommerce

“Social networks are an integral part of our lives, so it’s no surprise that they want to play a role in our finances. Many people however still have concerns about security online, with identity fraud rife using data cribbed from social networks and until these fears are put to bed, this will be a big barrier for the wholesale adoption of this technology.”

 TK Keanini, CTO at Lancope

“It has become a standard feature of social communities to have in-game or in-world commerce. Most online game communities offer this and from that perspective Facebook is late to the game.

“This payment system is exciting and useful to everyone, including criminals, so everyone must do their part to secure their accounts. Remember, when your account is compromised, it effects everyone. Some people treat Facebook as a play account and don’t take security seriously, approving friend requests from complete strangers, accepting game invites from anyone, these accounts may be more of a problem now that you can send and receive payments.”

 Tim Erlin, director of security and risk at Tripwire

“While Facebook may be late to the mobile payments game, they’re large enough that they can still dominate the space. It’s not hard to imagine how this feature might expand from peer-to-peer transfers to compete with the likes of Apple and Google for payments to more traditional vendors.

“The Facebook platform, including the mobile app, is already a big target for attackers, but adding a financial component to messenger puts it in a different category. There’s simply no doubt that cyber criminals will immediately begin looking for ways to use this new feature to get into your wallet.”

 Mark James, security specialist at ESET

“The financial structure already in place for Facebook to handle transactions has been around for a while. They have taken that platform and enabled users to split bills, send money and purchase things from friends all without a charge.

“If you already have your payment details in place with Facebook then it will just use those details, if not, you will need to add a debit card to get started. I am sure security will be their number one priority; it would appear that currently the goal is to offer a free of charge service with the intention of keeping you fully embedded into the Facebook ethos, and if it means saving some money then it could be a good thing.

“Digital payment methods are increasing and as long as security keeps up, it will benefit us all. Although Facebook is a big target and will be looked at very closely by cyber criminals once this goes live, Facebook will invest heavily in this security in an attempt to keep our data safe.”

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