Facebook offers PayPal option for buying virtual goods
19 February 2010 | 8030 views | 0
Facebook has teamed with PayPal on an online payments system that enables users to buy virtual goods on the social networking site.
The site has been testing its virtual currency system, Facebook Credits, with a small number of games and applications for the last few months as it looks to take advantage of the potentially lucrative micro-payments market.
Now its 400 million users will be able to use PayPal to buy Facebook Credits which can then be used for virtual goods, including at the site's official gift shop.
Users can already buy credits using cards and mobile payments system Zong.
In addition, the agreement lets firms use PayPal to pay for Facebook Ads through the company's online advertising tool. PayPal - which offers payments in 24 currencies and 190 countries - says the move makes it easier for small firms, particularly those outside of the US, to run campaigns.
Dan Levy, director, payment operations, Facebook, says: "We want to give the people who use Facebook, as well as advertisers and developers, a fast and trusted way to pay across our service. As our business has grown, offering local methods of payment has become increasingly important for advertisers who want to buy Facebook Ads. Teaming with PayPal, a global leader in online payments, makes this possible."
For its recent redesign, Facebook Credits were moved to a more prominent position on user profile pages, as the social networking giant looks to generate fresh income from peer-to-peer network activity on the site. Developers offering the currency will pay a hefty fee for the privilege, with Facebook proposing to take a 30% slice of all payments made by credits.