Two massive changes to the world of payment are right around the corner. Card purchases are about to become easier and Facebook is teaming up with PayPal.
MasterCard (NYSE: MA) wants to eliminate the signature requirement for payment in the United States in Canada in April 2018, Mac Rumors reported. This is not as big a deal as many people think because many American merchants already wave the signature requirement for purchases under $25 or $30 or $50. Around 80% of MasterCard purchases in North America are already signature free.
This can encourage the use of payment apps because some processors require signatures for Android Pay purchases over $50. Signatures are already history in most of Canada, where chips and PINs (personal identification numbers) are the standard methods of verification.
An added benefit to this change would be to speed up checkout lines. It might also encourage the use of self-checkout and payment apps.
PayPal in Facebook Messenger
PayPal (NASDAQ: PYPL) are now able to send cash to friends and family via Facebook Messenger, a press release indicates.
PayPal now supports a peer to peer (P2P) payment app in Facebook Messenger. The app launched on October 20, 2017. The press release did not say if the app would be integrated with PayPal’s popular peer to peer solution Venmo.
This proves that Facebook (NASDAQ: FB) is way behind Alphabet (NASDAQ: GOOG), PayPal, and Apple (NASDAQ: AAPL) in P2P. Alphabet (NASDAQ: GOOGL) just launched an ambitious new P2P app in India called Tez in India, and Apple is planning an Apple Pay Cash for its messenger.
A major fear for Facebook, Apple and PayPal should be that Google will bring Tez to the United States. Another is the slow infiltration of U.S. market by Alipay from Ant Financial. Tez, in particular, is a menace because it combines P2P, a digital wallet, and commercial payment in one simple solution.
This is big news for PayPal because Facebook Messenger is one of the world’s most popular social media solutions; with 1.3 billion users in September 2017, Statista reported. To add icing to the cake, Facebook also owns WhatsApp which also has 1.3 billion users worldwide.
There are currently no plans to add PayPal to WhatsApp but if they do it would make PayPal one of the world’s most valuable payments solutions. Expect to see massive growth at PayPal if this works out and regulators tolerate it.
The world of payment is changing fast, styluses and pens might soon be things of the past at checkout lines. One will have to wonder when registers with no receipts or an optional receipt become the norm. I imagine some big retailer like Walmart (NYSE: WMT) will move to eliminate paper receipts soon.
Killing paper receipts can save money, and speed up checkout lines by eliminating the need for the cashier to change the register tape. It would also eliminate a lot of litter and potential security threats from all those receipts polluting people’s purses and pockets.