Read About Facebook Payments
The Facebook Payments subsidiary has incorporated under Florida state law, and has three of Facebook’s top executives as directors: Chief Financial Officer David Ebersman, Vice President of Partnerships and Platform Marketing Dan Rose, and Vice President and General Counsel Ted Ullyot. The subidiary’s president and chief executive is Prashant Fuloria, according to a “certificate of authority” issued March 1 by the Idaho secretary of state. That document lists the chief financial officer as Jas Athwal.
So what is Facebook Payments?
The creation of Facebook Payments may signal an intent by Facebook to get more involved in the payments business while also making its business operations more efficient. While it doesn’t appear that Facebook will begin any kind of online payments service to directly compete with eBay’s PayPal, it could be planting the seed for such a future development.
You see, Facebook is already in the payments business already. Despite the fact that most consumers don’t pay to use the site, it still processes hundreds of millions of dollars a year in advertising revenue. It also has a modest but fast-growing business in Facebook Credits, a Facebook-only currency it sells to consumers to let them buy virtual goods in games like Zynga’s FarmVille and Crowdstar’s Happy Island, and now even rent movies on Facebook. When you handle the millions of dollars worth of these types of transactions, credit-card processing fees add up fast, and Facebook Payments could form direct ties to Visa and MasterCard’s payment networks, cutting out a merchant-bank middleman and saving on costs.
Facebook’s formation of Facebook Payments doesn’t necessarily mean that it will enter the merchant services industry, of course, but it does plant the seeds for moves that could put some scare into companies like PayPal, Amazon.com, and the banking industry.
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