September 25, 2013
How many times you check Facebook status and messages? Ok, lets keep that a secret (huh). Well, its a lot I know for myself. On a different note, how much do you hate filling those numerous details to process a payment on smartphone? It can get frustrating sometimes but you are not around the PC and you need to do it. What if we combine these two things and see if we can solve one of the problems (later one).
To fill in payment details before checking out can be a pain on smartphones. Typing on a small virtual keypad is still not that fast and super easy. Users also end up re-correcting numbers if a wrong key is pressed and as a result lose time. This complex user experience makes users shy away from paying through their smartphones a lot of times.
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To solve such issues, Facebook aims to make payments Frictionless through the launch of its new ‘Autofill with Facebook’ feature. Early this week, Facebook introduced this option to select users and is currently in a test phase. Autofill feature is currently available while checking out items from Jack Threads and Mosaic. A user is prompted with a small drop-down prompt button at the time of check out. Prompting such an option would take a user’s bank details from Facebook and fill the payment info screen at checkout.
This is similar to how tons of apps on your iphone take Google or Facebook based sign ins and even sign ups. However dealing with payments data is different ballgame altogether and needs superior security checks.
Facebook has partnered with payment platform providers like PayPal, Braintree and Stripe to launch this feature. There is a high likelihood that soon Facebook will be rolling out the Autofill feature to a bigger ecosystem of online merchants and providers.
Analysts at Techcrunch, All Things D see this move as a tactical one. In comparison to PayPal, Apple, Amazon, etc., Facebook doesn’t have sufficient credit card details of its users. Such a move will help Facebook to build up its inventory of user’s credit card details. Which could pave a way for Facebook to shun its partners like PayPal, Braintree and Stripe and go out solo as a Payments Processor. Apple already has millions of customer credit card details stored safely and being used for purchases on itunes and appstore. It gives them a great leverage in the payments space. Facebook doesn't want to be left behind.
One of the advantages that Facebook will see from its Autofill feature is the access to the user spending behavior. Facebook will be in a position to access user’s credit card details, purchase history and most importantly apps on which the money was spent on. This will enable Facebook to convince the advertisers to spend more money on campaigns. Thus, benefiting the whole ecology including Facebook, advertisers, developers and users.
LTP View: With the latest addition of Autofill feature, we may be looking at Facebook taking baby steps to offer end to end mobile payments soon. It would be interesting to see if Facebook plans on acquiring any payment processing companies. LTP sources have revealed that Facebook is building new products in the payments space and so are other major tech companies. Things are heating up and we continue to talk Payments!