Snapchat teams with Square for IM cash transfers

Ephemeral instant messaging (IM) service Snapchat has teamed up with payment processing outfit Square to allow users to transfer cash to each other over IM. The new service is called Snapcash, appropriately enough, and will initially only be available in the US.

The process seems to be pretty straightforward, with Snapchat users just needing to initially register their debit card with Square. Then it’s just a matter of sending an IM to a contact (who presumably will also need to have registered with Square) and including a number preceded by a dollar sign. Once it detects the dollar sign the ‘send’ icon then changes to a dollar sign to indicate you’re about to transfer money and all you need to do it press it.

“Today is a big day for us,” said the Snapchat blog. “We are launching our first product created in partnership with another company. We’re huge fans of the folks at Square and have been big admirers of Square Cash since it launched – just type a dollar amount into the subject line of an email and send cash to friends. Genius!”

In effect this is a Snapshat front end over the existing Square Cash product. The partnership gives Square access to Snapchat users and Snapchat the financial services credibility of Square. In fact none of the private financial information will even be stored by Snapchat.

The mobile money industry seems to be finally ramping up after years of speculation and false dawns. While major mobile wallet schemes like Apple Pay may still be the aim, incremental developments such as this could well lay the technological and social foundation for further progress. Here’s the Snapcash video.