Facebook has denied that it has any intention to compete with banks, in a move to calm concerns reported on last month by Commonwealth Bank of Australia boss Ian Narev that it poses a strategic threat to the big four banks. Narev is one of many to note that technology giants such as Facebook, Google and Apple could harness their massive user bases to muscle in on payments or other banking services.
Neil Hiltz, the global head of Facebook’s financial services vertical, noted that moving into the payments business was not a focus for Mark Zuckerberg and Facebook doesn’t want to be in the business of holding deposits, instead preferring to remain an intermediary in transactions and a natural place to invest ad buy.
“At the end of the day, no matter what we do, we are going to be underpinned and backed by the banking system,” Mr Hiltz said in an interview during a visit to Sydney, reports the Sydney Morning Herald. “We might be a communication layer between [banks and their customers] but transactions are going to be drawing out of a current account or a card – it is going to be backed by the banking system.”
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