Social media is everywhere. And we use platforms such as Facebook, Twitter, and LinkedIn to literally run our lives, whether it’s to:
- Connect with friends
- Plan upcoming events
- Find jobs (as a candidate)
- Find customers (as a business)
It only makes sense that these platforms would add payment functionality. In fact, Facebook already makes it possible to host fundraisers for parties and charity drives. And it recently introduced the world’s first social media cryptocurrency — Libra.
Add Twitter’s Pingit and WhatsApp Pay, and it’s clear social commerce isn’t going away anytime soon.
The question is: Are these payment tools safe?
The Truth About Social Media Payments
There are compelling reasons to embrace social commerce. All of the aforementioned tools are already integrated with the platforms, so it’s very simple to send and receive money without having to pull out your wallet or download a separate app.
- As a user, this creates a more seamless shopping experience.
- As a merchant, this convenience leads to higher conversions.
In addition, social commerce can be significantly cheaper for all parties since sending and receiving funds aren’t necessarily moneymakers for platforms such as Facebook. The goal is to keep you online as much as possible for data mining purposes.
Despite these benefits, social media payments have some serious downsides.
The Drawbacks of Using Social Commerce for Your Business
Speed, convenience, and cost are all substantial benefits of social media payments. But when it comes to privacy and security, social media platforms don’t have the best track records.
Remember the Cambridge Analytica cyber breach that exposed the personal details of nearly 90 million Facebook users? This data was provided by the social media company without the users’ knowledge. So, in truth, it wasn’t even a “hack” — it was a breach of trust.
More recently, actual hackers gained access to 30 million to 50 million Facebook accounts — stealing names, email addresses, and phone numbers. Fortunately, no financial data was stolen (that we know of) — this probably stems from the fact that payments and cryptocurrencies are relatively new in social media. In effect, there simply wasn’t a whole lot of financial data to steal.
Of course, this will change as social commerce becomes more mainstream.
To be clear, Facebook itself isn’t the problem. Even if you conduct most of your business on Twitter, Instagram, or some other platform, the security risks don’t suddenly disappear. These companies make money by selling your data, not from taking commissions. This isn’t to say that security isn’t important to them, but fraud management takes a backseat to keeping you online.
Should You NOT Use Social Commerce at All?
As a consumer, think twice about sending and receiving money through social media platforms. There are too many potential risks involved. You are better off using channels, platforms, and processors that are dedicated to PCI-compliant data security.
As a merchant, the situation isn’t as clear cut. Here’s why:
- As a general rule, it’s good practice to offer as many payment options as possible. Doing so reduces the likelihood of turning away potential sales, especially as more of your customers flock to social commerce.
- Potential data breaches are bad, but they aren’t necessarily attached to your business. Facebook, Twitter, and WhatsApp are responsible for payment security on their respective platforms, and any breaches or attacks ultimately fall on their shoulders — not yours.
Even still, it’s important that you are aware of the potential risks. If you decide to embrace social commerce, it’s a good idea to also offer alternative payment methods that don’t rely on platforms like Facebook.
To learn what steps BluePay takes to protect our clients’ businesses from fraud and abuse, schedule a free consultation with our payment security team today.