Musk to take on PayPal as Twitter prepares to launch online payments
Elon Musk is going head to head with his old company PayPal as Twitter gears up to become an online payments business.
The social media company has been applying for payments processing licences across the US as well as hiring people to start building a payments system.
Twitter’s director of product management, Esther Crawford, is in charge of the operation to turn the social media website into a PayPal rival, the Financial Times reported.
In November Twitter registered with the US Treasury as a payments processor, according to regulatory filings.
Mr Musk cut his business teeth as chief executive of a dotcom bubble-era company acquired by PayPal, the online payments giant.
Plans were in place for Twitter to set up an online payments division last year, pre-dating Mr Musk’s buyout of the company for $44bn (£35.5bn) last October.
PayPal’s acquisition by eBay for $1.5bn a year later, in 2002, set Mr Musk on the path to becoming owner of one of the world’s most influential social media websites, as well as helming a rocket launch company and a global electric car manufacturer.
After acquiring Twitter, Mr Musk said he would turn it into an “everything app” called X, echoing the name of the company bought by PayPal two decades ago.
Many tens of thousands of Twitter users share links every day to payments processing websites such as PayPal, Cashapp and Venmo. Integrating payments into Twitter could be a route to opening up new revenue streams.
Twitter is heavily dependent on advertising revenue for its survival, a dependence that has taken a major hit after Mr Musk acquired it.
A series of erratic decisions about letting banned users including ex-US president Donald Trump back onto the site, combined with around 5,000 staff departures, spooked advertisers.
Major spenders including Volkswagen, US foodstuffs conglomerate General Mills and pharma business Pfizer all suspended ad campaigns with Twitter last year.
Some reports claimed that Twitter has lost half of its top 100 advertisers over the last three months.
Industry sources cited concerns over brand safety as content moderators were made redundant.
Another advertising disincentive was Twitter’s move to offer blue ticks, previously used as a mark of authenticity, for sale to any user for $8 a month. Pranksters jumped on the site to impersonate major brands, in some cases posting fake messages that moved stock prices.
The multibillionaire is also chief executive of electric car maker Tesla. Some analysts and investors expressed unease at the end of last year over Mr Musk’s focus on Twitter, which appeared to be dragging Tesla’s share price down.
The car company is currently up 57pc from the start of this year, trading at $169.75.