| Facebook CEO, Mark Zuckerberg |
It will use payment details added by users to their Facebook account to automatically fill in forms when they make purchases on mobile applications, the BBC reports.
Various companies have been looking to tap into mobile payments markets.
However, Facebook said the feature would not involve moving the payment processing away from an app’s current service provider.
“This product is simply to test how we can help our app partners provide a simpler commerce experience,” Facebook’s spokeswoman Tera Randall said in a statement.
She added that the firm has a “great relationship” with PayPal, one of the biggest processors of online payments.
Fantastic move
This feature will help them demonstrate to the advertisers the effectiveness of its platform in driving revenue.”
Facebook has more than a billion members and half log in daily. Its popularity has seen it attract advertisers keen to tap into the potential consumer pool.
According to its latest earnings report, it generated advertising revenue of $1.6bn (£1bn) in the April to June quarter this year.
Analysts said that if the site does eventually launch the payment feature it will help it track how many of its users actually purchased items from partner applications.
“Facebook does not want to remain just a platform for brand promotion and lead generation, but it wants to become the place where e-commerce deals actually happen,” Manoj Menon, Managing Director of consulting firm Frost & Sullivan told the BBC.
“This feature will help them demonstrate to the advertisers the effectiveness of its platform in driving revenue. It is a fantastic move by Facebook,” he added.
However, some analysts were sceptical if users would trust a social networking site with their financial information.
“Consumers want safe, seamless and convenient mobile payments and there are a growing number of competitors that consumers trust more, such as PayPal, Visa (V.me) and others,’ said Denee Carrington, an analyst with Forrester Research.
- BusinessDay