Facebook has started asking some users to add their payment information like credit card or debit card details. This has led many users to wonder – why is Facebook asking for payment info all of a sudden? There are a few potential reasons behind this move.
To Support Facebook Pay and Facebook Shops
One of the main reasons is that Facebook wants users to save their payment information to use for purchases on Facebook. In 2020, Facebook launched Facebook Pay, a payment system that allows users to make payments across Facebook, Messenger, Instagram and WhatsApp. Users can use Facebook Pay to send money, make donations, purchase products, pay bills and more. To use Facebook Pay, users need to add a payment method like a credit/debit card, PayPal account etc. So asking users to add a card can help increase adoption of Facebook Pay.
Similarly, in May 2020, Facebook launched Facebook Shops which allows businesses to create online stores on Facebook and Instagram. Customers can browse products, message businesses and make purchases right within Facebook. To encourage transactions via Facebook Shops, the company needs users to have their payment information readily available. This makes the checkout process seamless.
To Support Transactions in Games and Apps
Facebook also asks for payment information to facilitate in-app purchases in games and apps available on the Facebook platform. Games like Farmville, Texas HoldEm Poker, Dragon City and more allow users to make in-game purchases to get additional coins, chips or features. Without stored payment information, users would have to enter their card details each time they want to make a purchase in one of these games. This friction can result in loss of revenues for the developers.
Similarly, users may need to make the occasional purchase within various apps on Facebook. Adding a payment method makes these transactions quick and painless for customers.
To Verify Identity
Facebook may also ask users to submit their payment information to verify their identity. Facebook has strict rules around users submitting their real identity on the platform. Spammers and scammers often create fake accounts in bulk for malicious purposes.
To curb this behavior, Facebook tries to ensure only genuine users can create accounts. One of the ways they can verify an account belongs to a real person is by requesting confidential financial information like credit card or debit card details that only the rightful owner would have.
To Build Profiles for Ad Targeting
Finally, some speculate that Facebook asks for payment information to build more detailed profiles of its users for ad targeting purposes. Facebook makes the vast majority of its revenue through advertising. The more data they have about each user’s preferences, habits and demographics, the more effectively they can target ads.
Payment information like a connected credit card can offer signals about a user’s income level and spending habits. However, Facebook maintains they do not use financial information for ad targeting without explicit permission from the user.
How Facebook Uses Payment Information
According to Facebook, here is how they use the payment information provided by users:
- To facilitate transactions made through Facebook products like Facebook Pay, Shops, games, apps etc.
- To verify users’ identities and prevent fake accounts.
- To pre-fill payment information at checkout for faster purchases.
- To show targeted ads for payment-related products like credit cards.
- To customize ads based on user spending habits and income level only if the user consents to this kind of ad targeting.
Does Facebook Share Payment Information?
Facebook claims they do not share users’ stored payment information with any third-party partners directly. However, they may share some signals derived from payment information like users’ purchase history and spending habits. But they will not pass on confidential payment details like credit card numbers outside of Facebook without explicit consent.
How to Add or Remove Payment Method on Facebook
If you are asked to add a payment method on Facebook, you can do so by following these steps:
- Go to Settings > Facebook Pay on the Facebook app or website.
- Click on the option to add a payment method.
- Choose whether to add a credit/debit card, PayPal account or other payment method.
- Enter the required information and submit.
To remove a saved payment method:
- Go to the same Settings > Facebook Pay page.
- Click on the stored payment method.
- Choose Remove to delete it.
Should You Provide Payment Info to Facebook?
The decision about whether or not to provide your payment information to Facebook is a personal one. Here are some pros and cons to consider:
Pros
- Lets you quickly and easily make purchases through Facebook products.
- Saves you time by avoiding re-entering payment details.
- Provides Facebook with a signal to verify your account is real.
Cons
- Gives Facebook access to sensitive financial information.
- Provides additional personal data that feeds into their ad profiling.
- Potential security risks if payment data is mishandled.
You need to evaluate these trade-offs and decide if the convenience is worth the privacy implications. Some options if you are uncomfortable include:
- Using a virtual credit card number instead of your real card.
- Entering your card details each time instead of saving to Facebook.
- Avoiding purchases that require payment information.
Conclusion
Facebook asks users to provide payment details like credit card information to enable various purchasing functionality across their products. It allows users to conveniently make transactions, while providing Facebook valuable data for verification, customization and driving revenues. However, it also gives Facebook access to sensitive financial information that makes some users uncomfortable. You need to weigh the pros and cons based on your personal preferences regarding convenience, privacy and security.