Aug 20, 2013 Dave King
Mobile payment solutions have long been marked as the next big thing in consumer technology by industry experts. Despite the predictions, mobile transactions have failed to catch on with consumers for a number of reasons. Some payment systems are inconvenient, while others are simply too costly for vendors to implement into their storefronts.
However, a new competitor in the market may have enough clout to change the slow adoption rate of mobile pay technologies. The Associated Press reported that Facebook is planning to test a mobile payment application in the near future. The service would allow users of the social media platform to purchase products through a smartphone app with payment data they have previously stored on their accounts.
Currently, Facebook is conducting a small-scale test for the mobile technology and no date has been set for a possible public launch, the AP noted.
Despite the company's inclusion in the market, the source cited experts from Forrester who believe the social giant will have trouble convincing consumers to use the app, as they may be more likely to use mobile technologies from a more trusted payment company, such as PayPal, that is experienced in electronic transactions.
InformationWeek reported that officials with Yankee Group expressed a similar concern about Facebook's ability to woo consumers. They believe that the social media company needs to first showcase a dedication to privacy before they can gain buyers' trust. Also, the source noted that Yankee Group researchers believe the payment platform must be easy to navigate for widespread adoption to take place. If the app is hard to use, the source speculated that it could do more harm than good to Facebook's brand.
However, Forbes noted that Facebook has a history of payment app creation which could prove to be useful for making their mobile transaction service attractive for consumers. Both Facebook Credits and Facebook Gifts have been reasonably successful tools that the company has launched in the last several years.
The mobile payment market currently lacks a major player, which has been one of the biggest barriers to widespread mobile transaction use. If it proves successful and easy to use, Facebook's app could provide a boost to the market that has been in a stagnant state for some time. With so many people using the social media service, the market potential is massive.