With job posting, Snapchat hints at reinvesting in payments

Remember Snapcash, the payments offering by the popular disappearing message app Snapchat that never seemed to take off? Now, parent company Snap is seeking a new payments product manager, suggesting a reinvestment in payments.

According to a job posting, Snap is looking for someone to build and manage relationships with financial services and technology providers, create new payments and commerce opportunities, devise long-term strategies for internal tools, data and revenue-related products and lead a team from a payment product’s conception to launch.

Snapcash was introduced in late 2014, and Snap hasn’t shared Snapcash users stats or transaction volume, so it’s unclear how it’s actually performing. Snap did not respond to interview requests by deadline.

“There is no indication of what kind of payment volume they’re doing, and it’s not a good sign,” said Ron Shevlin, director of research at Cornerstone Advisors and author of Smarter Bank. “When you’re successful, you like to tell the world what you’re doing, like Venmo does, because it’s impressive.”

Unlinke Venmo, which launched in 2009, Snapcash didn’t have a clear value proposition. The vanishing concept at the heart of Snapchat’s brand doesn’t translate well to financial transactions, and there was a mismatch between what people used Snapchat for and what they want from payments, Shevlin said.

“They want and need an electronic paper trail and Snapchat doesn’t do that,” he said. “The whole payments strategy from Snapchat was a bit of a stretch because it wasn’t a logical extension of what they were doing. It appealed to a demographic that was actually not making a lot of payments.”

Venmo, by contrast, easily became part of the lives of 20-somethings, who were eating out a lot and splitting the bill or had at least one roommate and could use it to split rent and other utility bills. It was free, easy and fun — three qualities not to be underestimated, Shevlin said.

Through a deal with Square, users can add a debit card, type a dollar amount into Snapchat’s text-chat feature, and hit a green “pay” button to send money to someone instantly. It’s effectively a white labeling of Square Cash. Your friend has 24 hours to accept the payment or else it’ll be refunded to you to make sure it didn’t disappear. Square declined to comment.

Snapchat’s search for payments expert suggests that something about the payments play is working, or that Snap is now trying to improve its value to users now that it’s gone public. Snapchat also faces mounting competition from Facebook, which hired PayPal president David Marcus in 2014 and launched payments through Messenger in 2015 and has lately been adopting Snapchat-like features for Facebook and Facebook-owned Instagram.

Facebook’s Instagram Stories has 200 million daily active users, Facebook reported earlier this week. Snapchat reported 161 million daily active users in February, an 82 percent decline since the launch of Instagram stories.

“[Snap] wants to become a more important platform in their customers lives and that Facebook hired the president of PayPal for its messenger platform clearly suggests these companies think payments is an important hole in their story,” said a payments expert at a U.S. bank, who asked to remain unidentified because employees aren’t allowed to comment on other companies. “Maybe they want to start e-commerce stores that Instagram has been quite successful in letting its users build.”

The source pointed to China’s WeChat as an example. Commerce is embedded deeply into the app, he said. U.S. platforms haven’t gotten there. They mostly allow people to talk, but not connect with businesses easily like WeChat does.

“Snap has always been the ‘fun’ platform,” the source said. “They need to get people to think of them as the core way to manage their life. Facebook with a public social graph has it, Snap doesn’t.”

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ATMs as the distributed bank of the future

A recent study showed that for the first time, there were more ATMs located away from bank branches than located onsite. That’s an interesting outtake as banks shrink their physical branch footprints.

The nature of the ATM-as-banking-node is changing, too. In 2001, Gene Pranger was hard at work on uGenius, a pioneer of the Interactive Teller Machine. Now, with BankOn, he’s on to something arguably even bigger: mobile video banking.

Facebank

Anyone interested in seeing Facebook’s intentions when it comes to finance should take a look at the social network’s new European payment license. That’s in addition to the firm’s recent hire of David Marcus, PayPal’s former president, to run Facebook Messenger.

Facilitating global payments is a large opportunity that gets even bigger if you can figure it out for B2B payments. Payoneer recently acquired escrow-as-a-service firm, Armor Payments, and is serious about bridging the trust gap in global B2B payments.

What’s going on with demand for banking apps?

Mobile apps are growing, even if that growth is slowing down. Historical numbers of people are using mobile banking apps. The growth has been led by a younger demographic, which makes sense. Getting the rest of banking customers to use their phones for banking service is the next challenge. There’s still a lot of opportunity for banks to migrate older customers to other channels.

Finance bots

I wish I had an on-demand financial planner running my financial life. Now available on Facebook Messenger, Digit bot has helped people save $250 million.

Facebook has been encouraging financial institutions to use its messaging app as a bot platform. B2B communication platform Slack is also competing to become a financial bot platform and is actively investing in a variety of finance bots, including in startup Sway Finance.

Blockchain hype

Blockchain hype still outstrips real world activity. To see what’s going on in the real world, Tradestreaming spoke to a blockchain expert at SAP.

Can blockchain make life better for the world’s poorest people? On the business side, DTCC, Wall Street’s clearinghouse, thinks it can help and wants to adopt blockchain technology.

For its sake, Bitcoin may never be a currency. It’s something way weirder.