Elon Musk appears to be planning to turn Twitter into a bank, complete with what he describes as a “high-yield money market account,” debit cards, checks and loans. He outlined his plans at a last-minute meeting with staff today, and you can read a full transcript here.
Musk broached the topic of payments during his introduction, saying, “I think there’s a transformative opportunity in payments,” adding that the goal is “to enable people on Twitter to instantly send money anywhere in the world in real time.” We just want to make it as useful as possible.” He said the feature, along with “video content and content creator compensation” and improving search, is a “high priority.”
Musk says he’ll do a lot of things, so maybe you’re not closing your bank account yet
What does TaaPS (Twitter as a Payment Service) look like? Imagine if every verified Twitter user gets a balance, which they can use to send money to “anywhere in the system”. In theory, that could mean something like tipping other users or paying for paywalled video content, a feature reportedly introduced at the company.
Twitter will set up a “high-yield money market account so that having a Twitter balance is the highest return you can do,” Musk said. Instead of the “complex and expensive” system of traditional banks with credit cards, savings and checking accounts, CDs and the like, Musk says you have “one balance on Twitter that can easily go positive or negative.” He said this will allow Twitter to pay more interest on positive accounts and charge less on accounts in the red.
“…well, if you want to offer people a comprehensive service, then the most important elements should not be missing.”
For places that don’t accept Twitter payments, Musk says you’ll get a debit card tied to your balance and even traditional checks if you want them. “If you do all the things you want from a financial point of view, then we will be the financial institution of the people,” he added. When an employee commented that it sounded like Musk wanted to build a bank and asked him if he wanted to lend, the CEO replied: “Well, if you want to provide people with a comprehensive service, then you can’t miss important elements. ”
In his speech he makes the whole sound easy. “Payments are really just the exchange of information,” he said “from an information standpoint, [there’s] not a huge difference between, for example, just sending a direct message and sending a payment.” However, he admits that there are legal hurdles to overcome, and the company is seeking a money transmitter license in Washington, according to a report by platform game. The report also says that Esther Crawford, who has led the rollout of the new Blue service, has been named CEO of Twitter Payments.
It is worth pointing out that there is a huge difference between saving user information and money. If your account gets hacked and your DMs get leaked, it could be a pretty bad day for you. If your bank is hacked, you may be unable to pay rent.
Musk is no stranger to high-stakes ventures — he also runs companies that sell cars and launch rockets, both of which can be deadly if done wrong. But Tesla and SpaceX have a lot of things that Twitter doesn’t have right now. Namely managers and employees who are responsible for safety. Musk just fired nearly half of the company, affecting core tech teams, and there have been some cracks are starting to show that may be the result. Also, I might not want to navigate the legal and ethical red tape of starting a bank if my Chief Privacy Officer, Chief Information Security Officer, and Chief Compliance Officer had all just resigned.
While it’s hard to imagine the average Twitter user actually wanting to use the platform as a bank, the idea doesn’t come completely out of the blue. Musk has previously said he wants to turn Twitter into “X, the everything app”, similar to WeChat in China. (“Everything” basically includes banking services.) Musk also has a history of banking, as he helped found PayPal, a fact one employee referred to when asked about the company “starting a payment journey almost from scratch.”
Twitter co-founder Jack Dorsey has also built a successful payment company called Block, which is behind the Square payment platform and the Cash app.