Facebook, CitrusPay tie up to facilitate e-commerce
At present, the CitrusPay gateway allows Facebook users to make payments for games. But those in the financial tech sector said that this could be the first step to enable full-blown e-commerce within Facebook. The company is already moving into the e-commerce space internationally by allowing retailers to open ‘shops’ in the form of Facebook pages. The company is also building fund transfer functionality into Facebook Messenger. Clicking on the purchase button on games opens up CitrusPay’s local gateway.
Although Facebook was not available for comment, when contacted Amrish Rau, MD, CitrusPay, said, “Social payments are increasing exponentially. More and more businesses are using social channels for business instead of dedicated e-commerce websites. We are keen to enable Indian consumers to buy directly from social posts on Facebook and Twitter.”
The tie-up with a payment gateway is significant as it allows anyone with a bank account in India to transact. Net banking is more economical for merchants as they do not have to pay the 2% fee to the credit card companies. “We are seeing international e-commerce companies adopt local payment types like net banking so as to cater to the Indian banked population for payments,” Rau added.
Earlier this week, note-taking app Evernote announced that it has localized credit card payments in India allowing customers to pay in rupees for premium subscriptions. RBI’s regulations insist on localized payments where the underlying transactions are essentially taking place between two residents in India (card issued in India being used for purchase of goods and service offered by a merchant/service provider in India).
For local payments, the transaction should be authorized through two-factor authentication – card details and one-time password. Some online firms, which are headquartered in the US, treat the transaction as an international one and do not have two-factor authentication. In the case of taxi aggregator Uber, the RBI has said that it was a domestic transaction and should be subject to two-factor authentication.