Wrapping up our series this week on mobile payments, today we look into why some social platforms are well positioned to offer their own payment services.
Clocking up an average of 2 ¼ hours of consumer attention per day, social media services are increasingly becoming the main platforms for daily activities. That includes entertainment, or in this case, commerce and transaction-related activities.
In some Asian markets where consumers devote the longest periods of their day to social media, popular social platforms have become so ingrained in daily routines that consumers are now comfortable with using them as a way of paying for products in-store and online. The most notable example of this is WeChat Pay in China, but messaging services Kakao and LINE also enjoy strong usage as payment services in their respective regions.
As for whether we’ll see a service like Facebook follow suit and offer its own payment service, recent developments have shown that this is already happening in some regions. Wednesday’s chart demonstrated the consumer trust obstacles which are particularly pronounced in Western markets, and that’s why Facebook-owned WhatsApp has chosen India as a testing ground for the beta version of its own payment service.
Even so, we are seeing evidence that Western consumers are easing to the idea of carrying out some commerce-related activities on social media, especially among younger generations. Along with Snapchat, Facebook has offered peer-to-peer (P2P) payments in the U.S. for some time along with Snapchat, and has been granted an e-money license in Europe. It’s convenience which is social media’s main advantage in the mobile payments space, and demonstrating this convenience initially with P2P payments could be an ideal way of appeasing consumer trust issues.