Popular photo messaging app Snapchat has revealed a new feature which will allows users to transfer money to each other.
Snapcash is the result of a partnership with payment-processing company Square, which already offers its own stand alone friend to friend payment app called Square cash.
The service is currently only available to users in the United States who are over 18, however it won‘t be long before it makes it to the UK‘s shores.
No personal account information will be kept on Snapchat‘s servers, instead all the processing will be done using Square‘s servers with Snapchat simply acting as the middle man.
This news will come as a relief to some as Snapchat‘s security has not been bulletproof of late.
In January of this year, at least 4.6m user accounts were compromised by hackers who posted user names and phone numbers online.
Snapchat tried to allay fears in its announcement saying: “Square has a ton of experience in this area and our teams have been hard at work to make Snapcash a great experience for everyone.”
Similarities have already been drawn with Barclays Pingit app which allows users to send each other money just by using their phone number.
Bram Meuleman, Strategy Director at global media agency Carat doesn‘t agree with this comparison saying:
“Snapcash appears to be more PayPal than Pingit: it‘s a payment enabler, irrespective of the financial institution you are banking with.
It brokers a connection between two existing bank accounts and uses Snapchat‘s social network in combination with Square‘s payment processing services to transfer money from peer to peer.
Pingit operates on a similar principle, but only if the user has a Barclays account and meets eligibility criteria.”
Android smartphones are the first to receive the app update, starting now, with an iOS one reportedly coming soon.
