In the world of credit card processing the ecosystem for small businesses is always changing.
PayPal was at one point the only major player in securing transactions between two different parties online. In more recent years Square has made big inroads as a credit card processor by offering good equipment and an easy to use platform. Amazon recently announced that it would start offering credit card processing for its merchants.
There are also rumors surrounding Facebook hinting at a plan to expand in merchant services. Only time will tell if there is room for all the payment platforms and to see which one will win out. What follows would be some of the ways the e-commerce atmosphere could change if Facebook became a major player:
Facebook will have an advantage over its competitors on its own platform. People who wish to use PayPal to complete a transaction on Facebook have a difficult time as it stands now. Customers must click from Facebook onto a product page on a separate website. Users then move from the new website onto Paypal to complete the transaction. This is quite a cumbersome process.
Facebook could make the checkout process much efficient by integrating it into the Facebook platform. Online vendors could manage their inventory and sell directly to consumers on Facebook. This would stop customers from being forced to jump from site to site. Facebook already has enough information about users to ensure secure transactions.
Facebook offers a limited payment platform that can be used to take payment on Facebook apps and games. Facebook also allows users to give friends small gift cards. This obviously limits the potential for sales directly on Facebook’s platform. It will be interesting to see if Facebook encourages more transactions internal to Facebook.
Increase Facebook ecosystem
Offering merchant services would be a good reason to offer a direct selling platform on Facebook. This could compete with Amazon’s “seller” and Ebay “shops”. By offering merchant services it can increase the total reach of Facebook. This reach could help Facebook get more information about its customers. Facebook knows what people “like” but Amazon knows what people buy. Information obtained by offering merchant services could help improve advertising results with increased information about users’ spending habits. Facebook’s extensive knowledge of its own users makes it competitive with Amazon in terms of customer knowledge.
Facebook could be a major play in merchant services if it ever decides to really jump into the arena. Only time will tell if this turns out to be a good opportunity for Facebook and Online vendors. Until then if you need a merchant service account for your US Company we can help.