France’s second largest bank, Groupe BPCE, has unveiled new plans to team up with social media giant Twitter to allow customers to transfer money via tweets. The service will allow Twitter users to transfer money to other Twitter users in France, up to a maximum of €250 to individuals and €500 to charitable organisations. Payments by tweets will be managed by the bank’s S-Money service, which allows money to be transferred by text message and relies on the credit card industry’s data security standards.
What this means for you
Are we seeing the slow demise of cash? The payment services industry has traditionally been dominated by financial institutions but there is now increased competition and innovation driven by the likes of Twitter, Apple and Facebook, with customers continuing to demand greater flexibility and access to mobile money transfers.
As payment methods multiply to match the increased consumer desire for alternative ways to pay online, three things are becoming clear. This is an area that requires effective regulation, and the regulators are struggling to keep pace with developments. Payment service providers have to ensure that their products are risk-free (see the adverse publicity surrounding Bitcoin) which means indemnifying customers and focussing on KYC and take on issues. Finally, as the market becomes saturated and there becomes too many ways to pay, will the customer experience be affected? Retailers now have to carry so many forms of alternative payment to capture the market, that there is a risk of matters becoming confusing and off-putting to consumers.