Want to see your money do a disappearing act?
On Monday, Snapchat and Square revealed that the two startups have teamed up for a product called Snapcash, which lets users send money to friends through the ephemeral-messaging service. Snapchat users are accustomed to sending disappearing photos and videos through the app, but soon they might start using the service to settle a drink tab or a split a dinner bill. The feature acts similar to Square Cash, Square’s own popular peer-to-peer money transfer app, and serves as another sign that Snapchat is exploring new and unexpected ways to evolve the app beyond what made it popular in the first place.
Like Square Cash, Snapcash requires that users store their bank account information with Square, which handles the back-end money exchange. Once set up, users can send money via the Snapcash feature by simply entering a dollar amount into a chat, and sending it to a friend, as the bizarre promotional video above demonstrates.
The move highlights the ongoing trend of messaging services merging with the e-commerce space. Mark Zuckerberg recently poached former PayPal CEO David Marcus to oversee its messaging platform, a hire that many interpreted as a sign Facebook would eventually enter the payments space. Popular messaging products like Line have become hotbeds for e-commerce. And even Venmo, the Square Cash competitor, has grown in popularity in part due to its unique social features.
Snapcash represents just a toe in the water for Snapchat in the space. Perhaps wary of privacy concerns, the company, which has has long faced questions over its security, smartly decided to let Square handle user financial data, rather than storing debit account information itself.AT