Why is Social Media So Important for MSBs?
Transferring money is personal. Whether you are cashing a check to pay your monthly bills or sending money to a family member abroad, the transaction hits close to home. Most regular money transferrers are accustomed to an in-person model where they walk into their local money service business and physically hand a check to someone. They then wait for the check to clear and gather their funds.
At many locations, the MSB is coupled with a shop and incentives are provided for the person cashing the check to stay on premise and spend their money at an attached store. The entire family will make an errand out of the task and spend time together at their neighborhood spot.
When emigrants send remittances to relatives and friends back in their home country, a note is often passed between parties. The sender might include some news from abroad or a conversational tidbit for the person on the receiving end. The common thread that weaves through every type of money transfer is the social aspect.
Sending and receiving money or cashing a check involves a level of human to human contact. As technology propels us forwards into a world where software and apps replace humans, the desire for a social and human touch remains.
The Partnership Between Payments and Social Media
U.S. payments innovator Venmo is capitalizing on the inherently social aspect of money transfer with a platform built for sharing. Users can pay or charge their friends and include a note to accompany the transaction. Many users incorporate emojis and tongue-in-cheek descriptions, reinforcing Venmo’s success as a genuinely social application. Since Venmo officially launched in 2012, other social platforms are scrambling to stay relevant and compete with the payment app.
In a bid to enter the mobile money transfer marketplace, Facebook rolled out a peer-to-peer money transfer functionality in the US earlier this year. While users won’t be charged for transactions, some are eying this as a purely data-centric endeavor that will enable Facebook to offer specific financial information to its advertisers for advanced targeting capabilities.
The verdict is still out on the success of Facebook’s initiative, but if their international presence and ability to forge strong connections is any indicator, they will go far. Even the sometimes controversial video and picture sharing app Snapchat partnered with Square to form Snapcash. (Forbes)
After turning down a Facebook buyout, many questioned the future viability of Snapchat– but the company is now set to join the crowded peer-to-peer money transfer marketplace. Search engine giant cum technology pioneer Google is trying to make money social with their new Google Wallet, which is aimed to compete with Square and Venmo. (The Verge)
Your old standby, Paypal, is also working to stay relevant with the launch of their new custom URLs. Reserving your custom URL through PayPal.Me allows you to easily share your site with friends to send and receive money. (The Motley Fool) With over 15 years of person-to-person payments, Paypal is not offering a new service– they are simplifying and socializing their current offerings to compete with social money transfer platforms. The proof is in the marketplace, social media and the mobile money market go hand in hand.
Social Media and the Mobile Money Market
The importance of social media to the mobile money market cannot be overstated. The sharing is caring culture of social media platforms is becoming more and more mobile by nature. In fact, social media money transfers are set to drive mobile money transactions past 13bn this year, putting the total number of mobile money transactions on track for a 150% increase in 2015. (Money Market UK)
As the money transfer industry adapts mobile technology, more transactions are occurring than ever before. Internationally, remittances are worth worth twice as much as foreign aid- bringing about a staggering realization regarding the power of personal and social transactions. (The Economist)
The Future of Social Money Transfer
How will the saturated mobile money marketplace shape-up? It turns out that the survival of the fittest is really the survival of the most social. Businesses and apps that keep up with mobile technology and that commit themselves wholly to early adaptation of social platforms will win out. As the population gets more and more used to the ease of mobile money, they will seek out the platforms that let them connect in a meaningful and instinctive way.
At NCC, we know the value of human connection. Our team of experts dedicates themselves to our MSB client relationships– keeping you ahead of the curve and up and running in the face of regulatory obstacles. Our reliable check cashing banks give you a redundant MSB banking network and a real check cashing bank account.