![]() He wanted to build something similar for Snapchat, and he wanted Jack to help in the process. “Okay this is actually genius,” he wrote. When he received the email, Spiegel was blown away and responded immediately. (Square Cash launched publicly last October.) The duo had stayed close after being introduced by Peter Fenton, a Twitter board member and general partner at Benchmark Capital, and Dorsey wanted to show off the product. The idea for Snapcash came in May of 2013 when Square CEO Jack Dorsey sent Spiegel $25 via email while testing out Square Cash. Snapchat doesn’t experiment with updates using small test groups, so Snapcash has only been used internally to date. Spiegel wouldn’t share where the product is going, but it’s likely Snapchat will expand beyond those constraints as it learns how people are using the service. users 18 and over, and payments must be made using a Visa or MasterCard debit card. At launch, Snapcash is only available for U.S. Mobile payments is growing into a big business, and Snapchat has a number of avenues it can explore moving forward. Of course, Snapchat will offer competition if Snapcash expands. Instead, he sees Snapcash as an update that simply benefits his users. (Snapchat just rolled out its first advertisement, so the business strategy is still very much in the air.) Spiegel says that Snapchat doesn’t intend to compete on a payments front with services like Venmo or PayPal, and certainly not against partner Square. And while both companies declined to comment on the terms of the deal, it’s likely that Snapchat is paying Square a small fee for each transaction it processes.ĭespite the update, it’s unclear if payments will be a core part of Snapchat’s business moving forward. Square’s logo will appear within the app when a user is introduced to Snapcash for the first time. It’s likely not the only benefit, however. The automatic creation of new Square Cash accounts may be the greatest benefit for the payments startup, which will (in theory) collect payment data from a slew of new users. Many users still criticized Snapchat, claiming the company’s API should have been tougher to replicate. That leak was actually from SnapSave, a third party app that had duplicated Snapchat’s API without permission. Then in October, thousands of private Snapchat photos were leaked online, including pornographic images. The app was hacked on New Year’s Eve when account names and phone numbers were matched up online for almost five million users. This may appease some users concerned with Snapchat’s security. ![]() When a user signs up for Snapcash, they’ll be creating a Square Cash account at the same time and agreeing to Square’s terms of service, according to Square spokesperson. Users can then tap that button to activate the payment, which is completed once the message has been sent.Īs Snapchat’s partner, Square will be responsible for storing all user bank and debit card information, Spiegel says, meaning none of the personal financial information from Snapchat users will reside on Snapchat servers. With Snapcash, users simply type out the dollar amount they’d like to send as part of any private message - for example, “here’s $5 for lunch.” The app recognizes the “$5” text and a green payments button illuminates next to the keyboard. The new tool is powered by payments company Square, which operates its own similar service called Square Cash that allows people to send and receive money through its Cash app or email. ![]() ![]() Snapchat unveiled Snapcash on Monday, a new payments feature that allows users to send and receive money from friends through the app’s private messaging service, CEO Evan Spiegel told Re/code.
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