The news: Twitter started applying for state licenses in the US so it can advance its payments ambitions, per the Financial Times.
Key context: Payments have been a part of Musk’s vision for Twitter since he took over the company last October.
The challenge: The heavily-indebted Musk is under considerable pressure to generate income for the platform.
Payments could be the golden goose that turns Twitter’s financials around—but it won’t be an easy feat. Here’s why:
A marketer exodus has compounded Twitter’s financial woes.
The firm’s slim staff might complicate compliance.
Twitter will have to compete with well-established digital payment platforms.
The bottom line: Hundreds of thousands of Twitter users exchange third-party payment links with each other, according to research from FXC Intelligence cited by the Financial Times—highlighting a clear demand for payments. Still, the firm will need to gain customer trust; invest substantially in technology infrastructure, security, and compliance; and outline a clear value proposition for its venture into payments to pay off.
This article originally appeared in Insider Intelligence's Payments Innovation Briefing—a daily recap of top stories reshaping the payments industry. Subscribe to have more hard-hitting takeaways delivered to your inbox daily.
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