Snap’s one-time hope of becoming a major player in money transfers has come to an ignominious end. The company has confirmed that it’s discontinuing its Snapcash service on August 30th. While it didn’t say what would happen to users’ accounts, it promised that they’d receive notifications through both the Snapchat app itself as well as the support website. It’s sad news if you’re a frequent Snapchatter who used the feature to cover your share of restaurant bills, but you could see this coming given the competition and Snap’s own fortunes. If you don’t remember Snapcash, don’t worry on August 30th, Snap will discontinue its peer-to-peer money transfer service that launched at the height of the messaging app’s popularity.
Snapcash was announced back in 2014 when Instagram has yet to steal Snap’s users with the disappearing stories format, and Venmo was one of few apps you can use to send money to friends. Today, Snapchat is struggling to grow its user base against Instagram, and companies like Google, Facebook, Apple, and Zelle have begun offering their own services for transferring money to contacts. In a statement to Techcrunch, Snap confirmed Snapcash’s shutdown. “Snapcash was our first product created in partnership with another company – Square. We’re thankful for all the Snapchatters who used Snapcash for the last four years and for Square’s partnership.”
Though Snap didn’t specify why it’s shutting down Snapcash, it’s likely that the service never quite took off as Venmo continued to grow while Google and Apple began adding a similar feature to their respective mobile OS. Techcrunch’s report also notes that Snapcash seems to be associated with some erotic content online, with some Twitter users advertising sexually explicit photos in exchange for Snapcash payments. Additionally, Snap’s track record for security hasn’t exactly been enticing for users to trust it with personal information.
The company has been busy trying to boost revenue and user growth by adding a redesign that makes the app more web-friendly and a releasing second generation Spectacles that shoots videos compatible for viewing outside Snapchat. The hope, Snap says, is to grow beyond the core mobile app — and we’ll see just how well those efforts amount to when the company announces its next earnings report on August 7th.
Snapcash launched in 2014 as a partnership with Square that theoretically gave both sides a tremendous boost: Snap got a payment platform with relatively little work, while Square attached its service to a very familiar name. However, it’s no secret that Snapcash didn’t take off. For many, Venmo is the household name when it comes to pay-your-friends apps — and that’s not including mounting competition from the likes of Facebook, Zelle or tightly integrated features like Apple Pay Cash and Google Pay. No matter how well Snapcash worked, it was just one fairly ordinary option in a sea of choices.
The shutdown also comes as Snap itself has been struggling to stay competitive. Remember, Snapcash launched when Snapchat was at a cultural zenith, and Instagram was still two years away from introducing an imitative Stories feature that would ultimately help it eat Snap’s lunch. It was easy for Snap to add a feature like this when everything was coming up roses — it’s harder to justify it now, when the company’s core business is at stake. The discontinuation of Snapcash could help Snap refocus its efforts, especially now that it might have other, more effective ways of raking in revenue from your payments.
Snapcash ended up as a way to pay adult performers for private content over Snapchat, not just a way to split bills with friends. But Snapchat will abandon the peer-to-peer payment space on August 30th. Code buried in Snapchat’s Android app includes a “Snapcash deprecation message” that displays “Snapcash will no longer be available after %s [date]”. Shutting down the feature will bring an end to Snapchat’s four-year partnership with Square to power the feature for sending people money.
Snapcash may have become more of a liability than a utility. With apps like Venmo, PayPal, Zelle, and Square Cash itself, there were plenty of other ways to pay back friends for drinks or Ubers, so Snapcash may have seen low legitimate usage. Meanwhile, a quick Twitter search for “Snapcash” surfaced plenty of offers of erotic content in exchange for payments through the feature. It may have been safer for Snapchat to ditch Snapcash than risk PR problems over its misuse.