Facebook launches fiat payment system as regulators freeze Libra
Facebook Pay is designed to facilitate internal payments
Facebook has launched new payment system Facebook Pay, as the deployment of its crypto project Libra was suspended by global regulators.
In a statement, Facebook said the new payment system will work across Facebook, Messenger, Instagram, and WhatsApp. Facebook claims that people already use payments in these apps to send money to each other, buy apps or donate someone. Facebook Pay will facilitate those transactions.
The new solution will be built on existing financial infrastructure and Facebook's partnerships. In order to avoid further regulatory issues, Facebook Pay will be completely separate from the Calibra wallet designed for Libra network.
Facebook Pay will start working this week on Messenger and Facebook. Initially the payment system will be available only in the United States for P2P transactions, purchases from several Pages, businesses on Facebook Marketplace, as wall as for fundraisers, in-game purchases, and event tickets.
The company believes that the new service will "empower people everywhere to buy and sell things online".
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Facebook's crypto project Libra initially had the same goals. Presenting its much-anticipated payment solution in June, Facebook claimed that Libra will make it cheaper and faster to send money around the world.
However, the corporation's goal to create a global currency supported by major financial and tech companies created controversy.. Global regulators were concerned about the legality of an unregulated currency run by Facebook due to previous penalties for privacy violations.
Several countries, including France, Germany and the US, have taken a hardline stance against Libra. Due to the legal issues the Libra Association has lost some of its major partners, including eBay, Visa, Mastercard, Stripe and PayPal.
FURTHER READING: Facebook Libra, explained