Twitter Beating Facebook in Race to E-Payment

Twitter users in France can now tweet money to their followers. This effectively means that Twitter has beaten Facebook by being the first to introduce P2P transfer of money over their own platform.

Social networks have been in a race to implement integrated e-commerce solutions on their website. Facebook was the first to introduce e-commerce solutions (e.g. Shopify), but the possibility to transfer money is still missing. However, Facebook is rumored to already have applied for the relevant licenses for the ability to transfer money. An interesting addition to this is that Facebook has hired former CEO of PayPal to head their messaging division, which hints that in the future e-payments might be included in the functions of the Facebook Messenger.

BPCE (the second largest French bank by number of customers) has teamed up with Twitter to enable anyone with a bank account in France and a Twitter account to make use of the service. It is not yet clear if the transfer would remain private or if it would be shared with followers, as it is done on Venmo (owned by PayPal). Further details should be available after the company’s press conference in Paris on Tuesday, 14 October 2014.

This initiative is following Twitter’s introduction of a „Buy” button last month, which was the platform’s first direct step into e-commerce. Nathan Hubbard, head of e-commerce at Twitter stated, that conversations between brands and other users were mostly transactional, thus the enabling of selling directly through the platform was an obvious next step.

As S-Money, the subsidiary of BPCE coordinating the payments through Twitter mentions on their website, the payment mode should be simple, free, quick and most importantly, secure. As payments through social networks should be gaining importance in upcoming times, banks are faced with new challenges, including their decision whether to be included in this trend.

Would you use such systems to transfer money through? And do you think all banks should move in line with these developments?



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One response to “Twitter Beating Facebook in Race to E-Payment”

  1. bteber says :

    I think almost everybody will use these e-payment systems if they are secure, reliable and convenient in the future. Adoption of these systems will increase rapidly, like online banking for example. It took a while, but nowadays almost 80% of the Dutch between 16 and 75 years old uses online banking.
    As for most consumers the relationship with their bank predominantly consists of making and receiving payments (approximately 80 percent of customer interactions with banks), the traditional banks should also offer such e-payment systems in the future to keep their existing clients. After all, payments represent the beachhead for banking relationships. Entering this market (segment) by companies like Twitter could eventually lead to the end of traditional (retail) banks if they don’t reinvent themselves. Besides, by offering these e-payment systems, traditional banks could not only retain their clients for payment services, but also keep cross-selling more profitable complex services like mortgages.
    On the other hand, researchers at McKinsey found that the more customers use digital-banking channels, the more they actually use branches and call centers. Retail banks therefore are advised to integrate their digital and physical operations. Most retail banks already have moved their capabilities online to make banking more convenient for their customers, although not as convenient as these e-payment systems probably will be. Bain concludes that banks which like to stay in business, need to create additional online experiences, like starting the mortgage application when searching online for houses. They also should create flagship branches that serve as a nice place to be able to inform customers about complex products and to provide trusted advice.

    CBS (2012). Nederland in Europese top met internetbankieren, Available at:
    Denecker, O., Gulati, S., & Niederkorn, M. (2014). The digital battle that banks must win, McKinsey Quarterly August 2014
    Rigby, D. & Baxter, M. (2014). Rethinking the Bank Branch in a Digital World, HBR Blog Network, Available at:
    Sidel, R. & Efrati, A. (2011). Big Banks Join Battle for Online Payments, The Wall Street Journal, May 25, 2014

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