Facebook App Allows for Online Cash Exchange

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What will they think of next?

In a move that could put a dent in cash exchange providers like Paypal, a new application called Give More, Get More allows Facebook users to give and accept money while logged in — saving them a trip to Paypal or another cash provider.

The new application should be a big hit. After all, Facebook is massively popular. According to the company’s own numbers, Facebook now has 300 million users (up from 150 million at the start of the year). Furthermore, these users spend more than 8 billion minutes on the site each day.

If time is a commodity, then Facebook is the Internet’s chief currency — and it’s only growing bigger and bigger.

Take the money transfer application mentioned above. Give More, Get More, developed by a company called Facecard, actually allows users to spend money within Facebook. With it, users can send money to other Facebook members, view transactions and even set up “wish lists” that allow users to accept cash donations toward big events like a birthday, wedding or graduation.

The actual mechanics of the software fit easily into the Facebook culture. When users send cash through the Facecard application, a “gift” icon pops up on the user’s screen, letting the recipient know that cash is on the way.

To use the Facecard application, users need to sign up for Facebook (that part is free) then ship money from your bank account to a pre-paid credit card account managed by Metabank (Stock Quote: CASH). That part isn’t free — it costs 99 cents for accounts up to $20, and fees rise to 2.5% for cash amounts more than $600.

By using the pre-paid card, Facebook members also earn rewards points and discounts at favored retailers, online sites and restaurants. Cardholders can also set up one-time bill payments, much like online cash exchange giant Paypal. Facecard sends alerts out when the pre-paid card’s minimum balance level is about to be reached.

While Facecard is making the application free for now, it does plan to implement a new fee structure — a $5 sign-up fee and $3 per month to set up the account — before the end of the year. Users can have the monthly fee waived if they have their paychecks loaded to their Facecard account via bank transfer. That may not be such a great idea, as Facecard doesn’t pay any interest for holding on to your money.

But parceling out a few dollars for birthday gifts or for cash exchanges for kids away at college may be helpful for Facebook users — a demographic that continues to grow larger and more financially flexible by the day.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

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