Facebook tests Venmo-like QR codes for P2P payments

Dive Brief:

Facebook is testing a QR code-based peer-to-peer (P2P) payment channel, according to TechCrunch. As first reported by MacRumors, the payment option will make it easier for people in the U.S. to send or request money from one another.
The new service will be under the Facebook Pay umbrella that helps people pay to family, friends and businesses on Facebook, Instagram and WhatsApp.
This is the latest push by the social media giant to offer P2P payments. Last November, Facebook launched a pilot program that allows customers to transfer money via Whatsapp in India and recently acquired regulatory approval for the same in Brazil.

Dive Insight:

The payment channel is similar to Venmo and PayPal-based QR code methods. Users can scan a unique QR code to transfer funds. The payment channel is currently native to Facebook Messenger, where users are being presented with a new "Scan" button in the Facebook Pay carousel of the screen.

"To make payments on Messenger even easier, we've begun testing the ability for people to use QR codes and payment links when they want to send or request money," a Facebook spokesperson told TechCrunch. Facebook declined to comment to Payments Dive on the reports.

Users above the age of 18 who either have a Visa, Mastercard, a PayPal account or a prepaid debit card can make transfers using the new QR code feature. Users can also use a personalized payment URL in the format of "https://m.me/pay/UserName," to send to others when making a payment or sending a payment request.

While QR codes aren't the safest method to process a transaction, it is an easy method for users to make a transfer to each other. PayPal launched QR code-based payments for businesses last year and experienced a 19% increase in total sale volumes from consumers who used PayPal's QR codes in 2020, Jim Magats, senior vice president of omni payment channels at PayPal, said in an interview.

Facebook first launched Facebook Pay in 2019 to make payment channels easy for its users. Later it expanded the payment channel across its other platforms including Instagram and WhatsApp. Currently, Facebook Pay helps users pay on Facebook Marketplace, Facebook Shop, Buy on Instagram, and online donations on the social media platform.

The Menlo Park-based company has been trying to penetrate the payments landscape for quite some time. Facebook even announced its plans to build a stablecoin back in 2019, named 'Libra' which received a lot of friction from regulators. Last December, Facebook rebranded its stablecoin project as 'Diem' to get a clean slate in front of regulators and consumers alike.

Facebook also has a cryptocurrency wallet called Novi, which was launched last May. Novi's aim was to hold Facebook's cryptocurrency Diem, which is slated to launch later this year once it gains regulatory approval.