Instagram is building a standalone app for shopping

Instagram is working on a new standalone app dedicated to shopping, The Verge has learned. The app — which may be called IG Shopping — will let users browse collections of goods from merchants that they follow and purchase them directly within the app, according to two people familiar with the matter. Instagram declined to comment.

It could not be learned when the app might launch. Its development is still ongoing, and it could be canceled before it is released. But sources familiar with its development say Instagram believes it is well positioned to make a major expansion into e-commerce.

More than 25 million businesses already have Instagram accounts, and 2 million of them are advertisers, Facebook Chief Operating Officer Sheryl Sandberg said on the company’s most recent earnings call. Four in five Instagram users follow at least one business. Creating a standalone app would allow the company to provide a dedicated home for an increasingly popular activity on Instagram while also expanding opportunities for revenue.

Over time, Facebook could introduce more tools for merchants who are building their businesses on Instagram, directly challenging e-commerce platforms like Shopify, according to a person familiar with the company’s thinking. Most online businesses need an Instagram account already, the thinking goes; many of them would surely use paid business tools if they became available.

Some companies already sell such tools to Instagram advertisers. Four Sixty, for example, lets businesses pay for help creating shoppable photo galleries, content moderation, post scheduling, and other services. Shopify’s app store contains dozens of plugins related to promoting and managing Instagram-based businesses.

Instagram began testing a shopping feature in November in 2016, and rolled it out more broadly in March of last year. Companies can tag posts with individual products, allowing users to shop directly from photos. Instagram is currently testing a feature that lets users shop from Instagram stories.

Shopping would not be the first Instagram feature to be spun out into a standalone app. The company has been testing Direct, a new messaging app, since last December. In June it introduced IGTV, a YouTube competitor that puts vertically shot videos into their own app.

Facebook wants financial data from America’s largest banks

Facebook is asking large banks in the US to share their customers’ card transactions, shopping habits, and checking account balances to offer new financial services, as reported by The Wall Street Journal.

In an emailed response to the report, Facebook denies that it’s “actively asking financial services companies for financial transaction data.” It says that it’s simply looking to partner with banks and credit card companies to offer customer service through a chatbot in Messenger or help users manage their accounts within the app. Similar features already exist on Messenger with American Express, Mastercard, and PayPal integrations, but Facebook is looking to expand its partnerships with more traditional banks.

It’s part of Facebook’s bid to expand its Messenger app from chatting services to more core uses that would keep users on its platform longer. The new initiative comes after Facebook reported a quarter with its slowest growth since 2011.

The tech giant has talked to banks including JPMorgan Chase, Citigroup, Wells Fargo, and US Bancorp about what sorts of banking services Facebook Messenger could provide for customers, anonymous sources told the WSJ. It’s considering a feature that shows people their checking account balances from within Messenger and one that alerts users to fraud. “People can keep track of their transaction data like account balances, receipts, and shipping updates,” Facebook stated.

Still, Facebook’s reputation is marred by its recent data privacy scandal where Cambridge Analytica misused the data of 87 million Facebook users. Sources told the WSJ that the banks are concerned about how Facebook would handle data privacy when it comes to financial information, which is often more sensitive than Facebook user details.

One bank even ended talks with Facebook, citing privacy concerns, according to the report. Facebook’s response has been to assure banks it won’t use data for targeted advertisements and will not share it with third parties.

Facebook’s desire to expand into financial services mirrors what its rivals are doing on their own platforms. Other tech companies like Google and Amazon are also asking banks to share customer data so that they can add banking services on their voice assistants, according to the WSJ’s anonymous sources. While outwardly the companies’ efforts appear nearly the same, people’s trust in Amazon and Google ranks far higher than their trust in Facebook.

Even before Cambridge Analytica rattled people’s trust in the platform, people didn’t trust Facebook as much as other tech companies. In a survey conducted by The Verge last year, people rated Facebook as a company they largely didn’t trust. While Amazon earned nearly as much trust as a bank, 30 percent of people either greatly distrusted Facebook or distrusted it somewhat.