While Mark Zuckerberg has made it clear that Facebook is only interested in emerging markets such as WhatsApp and Oculus Rift, there is a report out that indicates Facebook may also be pushing its way into financial services.
The popular social media network has applied for a license to Irish authorities that would allow it to offer electronic money services to members across Europe. Facebook Europe, Asia and the Middle East is headquartered in Dublin, Ireland, so it only makes sense that Facebook would make the application for money transfer services, among other financial services it is reportedly looking at, in Ireland.
The company has apparently met with TransferWise, Moni Technologies and Azimo in order to work towards building the services for the implementation of Facebook’s financial services. Facebook would be going head-to-head with the likes of Western Union, PayPal and Vodafone’s M-Pesa, and a move of this nature would therefore mean a strategic shift of sorts for Facebook.
Facebook already makes about $2.1 billion in payments currently; most of this is from their online games. If the social media giant decides it’s time to shift into the financial services sector, this will see Facebook really have the potential for world domination of sorts, particularly in developing countries. Immigrants to North America often use money transfer services in order to send money to their families in their home countries. Many sectors of the population do not have bank accounts in these developing countries, and as a result, doing a simple email money transfer makes no sense, as to do so, you generally need a bank account to deposit the money to.
This is a sector of the business that involves billions of dollars yearly, and if Facebook were to press into the financial services sector, this could mean that Facebook could really add to its coffers in a big way; the financial services sector makes hundreds of thousands on a yearly basis, which means if Facebook was to take a cut of that, there would be significant additions to the Facebook bank account. In many respects, it would be fairly easy to access a Facebook money transfer and get it set up, rather than a transfer from Western Union or any other wire transfer service.
In addition, Facebook is the most popular social media network to date on the Internet. This means that Facebook could really expand its prospects by engaging in financial services practices beyond what it has done thus far with the online payments during Facebook games. It’s important to realize that even though a great deal of the financial things that Facebook has made use of largely revolves around games, there is even further potential if Facebook is going further than it’s ever gone before.