Facebook financial foray flops face first

Facebook has killed a feature which allowed users to pay connections through its Messenger app due to a lack of uptake.

The idea was a relatively simple one; Facebook’s Messenger app could be used to transfer funds between connections. The banks clearly thought it might be a goer, all the major institutions in the UK signed up, though a lack of consumer interest led the social media giant to pull the plug.

“The Facebook messenger functionality got all of the major UK banks on board when it was launched in 2017, but consumer uptake never took off,” said Oliver Wintle, Banking Analyst at GlobalData. “GlobalData’s 2018 Retail Banking Insight Survey found that 55% of users in France and 71% of users in the UK have never used Instant messaging to complete banking tasks.”

Why this feature failed to capture the attention of consumers is down to interpretation, GlobalData is suggesting it is simply down to breadth and depth. Considering how accessibly banking apps are nowadays, and the additional features which are available in the banking apps themselves, Facebook seemed to be addressing a problem which didn’t exist in the eyes of the consumer.

Another factor which you have to consider is the credibility of Facebook. Over the last 18 months, the social media firm has been central to a number of scandals, all of which has damaged the reputation of the brand. Asking consumers to trust Facebook in handling financial transactions, dealing with real money, might have been a step too far.

Facebook might be able to ask for user’s birthday or for data on their interests, but this is different to asking for financial information. In facilitating payments, Facebook is asking users to trust it with their hard-earned cash. To do this you have to have a lot of credibility in the bank.

While Facebook has certainly tarnished its reputation, it might also be the case no social media brand has the repute to introduce such an initiative yet. 55% of users in France and 71% of users in the UK have never used instant messaging to complete banking tasks, suggesting users do not view these platforms in this way.

Alongside the credibility issue, numerous telcos have launched features which allow customers to pay their contacts through text. Although this has the potential to fail in the same way Facebook has done, a lack of functionality compared to banking apps, customers trust telcos with their credit card details.