In what was deemed as a rather surprising announcement, Snapchat unveiled Snapcash, a person-to-person payments platform powered by Square. Snapcash, which is built directly into Snapchat’s messaging system, can be used to seamlessly send money from a user’s bank account to friends also registered with the program. To transfer cash, users just have to simply enter a cash amount into a chat’s subject line, such as $25.00, then press send.
Much of the work behind the feature is accomplished through a backend payments platform which as mentioned before, is powered by Square. Users who are interested in using the feature first have to register a debit card from which funds will be withdrawn or deposited. This information will live on Square’s secure server for future transactions, which Snapchat claims are nearly instant.
Snapcash in reality is a repackaged version of Square Cash, an internet-connected service that lets people send money to each other via email, app or the Web. Unlike Cash, which draws money from credit cards, Snapcash links directly with users’ bank accounts, which is a feature that many are weary of for various security reasons. To help combat the onslaught of security scrutiny, the following was mentioned by Snapchat:
We set out to make payments faster and more fun, but we also know that security is essential when you're dealing with money. 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.
Source: Snapchat (blog), iTunes
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