The US social media X continues on its journey to become a financial hub for its users. For the plans of its owner Elon Musk, the company requires money remittance licences in all US states and, as of early August, it has received them in 33 states (PYMNTS; X). Previously, Elon Musk has stated that he aims to launch X’s financial services products in mid 2024, and according to some user’s screenshot (TechCrunch), the technical development seems to be ready for the launch. However, this is likely only going to cover the peer-to-peer payment services the company is envisioning. For the logical next step, processing payments between businesses and consumers, basically enabling in-commerce services in X, the company will need to obtain a payment processor licence in each state (Stripe). Peer-to-peer payments is a nice feature, but players like Venmo and Zelle have addressed this need already in the past few years. Thus, peer-to-peer payments itself is not a game changer anymore. And additionally, only the commerce functionality provides actual revenue potential for X. So when we see the first financial product from X being launched, we should take a closer look to understand its potential impact on the business.
Elon Musk and X is extremely polarising these days. For me personally and probably for many others, it can be hard to exclude all of their activities and focus purely on their their embedded finance journey. Nevertheless, it is one of the rare examples where you can follow (at least partially) publicly how they build their products.
