Elon Musk rushes to debut X payments as tech issues hamper creator payouts

Elon Musk is still frantically pushing to launch X payment services in the US by the end of 2024, Bloomberg reported Tuesday.

Launching payment services is arguably one of the reasons why Musk paid so much to acquire Twitter in 2022. His rebranding of the social platform into X revives a former dream he had as a PayPal co-founder who fought and failed to name the now-ubiquitous payments app X. Musk has told X staff that transforming the company into a payments provider would be critical to achieving his goal of turning X into a so-called everything app “within three to five years.”

Late last year, Musk said it would “blow” his “mind” if X didn’t roll out payments by the end of 2024, so Bloomberg’s report likely comes as no big surprise to Musk’s biggest fans who believe in his vision. At that time, Musk said he wanted X users’ “entire financial lives” on the platform before 2024 ended, and a Bloomberg review of “more than 350 pages of documents and emails related to money transmitter licenses that X Payments submitted in 11 states” shows approximately how close he is to making that dream a reality on his platform.

X Payments, a subsidiary of X, reports that X already has money transmitter licenses in 28 states, but X wants to secure licenses in all states before 2024 winds down, Bloomberg reported.

Bloomberg’s review found that X has a multiyear plan to gradually introduce payment features across the US—including “Venmo-like” features to send and receive money, as well as make purchases online—but hopes to begin that process this year. Payment providers like Stripe and Adyen have already partnered with X to process its transactions, Bloomberg reported, and X has told regulators that it “anticipated” that its payments system would also rely on those partnerships.

Musk initially had hoped to launch payments globally in 2024, but regulatory pressures forced him to tamp down those ambitions, Bloomberg reported. States like Massachusetts, for example, required X to resubmit its application only after more than half of US states had issued licenses, Bloomberg found.

Ultimately, Musk wants X to become the largest financial institution in the world. Bloomberg reported that he plans to do this by giving users a convenient “digital dashboard” through X “that will serve as a centralized hub for all payments activity” online. To make sure that users keep their money stashed on the platform, Musk plans to offer “extremely high yield” savings accounts that X Payments’ chief information security officer, Chris Stanley, teased in April would basically guarantee that funds are rarely withdrawn from X.

“The end goal is if you ever have any incentive to take money out of our system, then we have failed,” Stanley posted on X.

Stanley compared X payments to Venmo and Apple Pay and said X’s plan for its payment feature was to “evolve” so that X users “can gain interest, buy products,” and “eventually use it to buy things in stores.”

Bloomberg confirmed that X does not plan to charge users any fees to send or receive payments, although Musk has told regulators that offering payments will “boost” X’s business by increasing X users’ “participation and engagement.” Analysts told Bloomberg that X could also profit off payments by charging merchants fees or by “offering banking services, such as checking accounts and debit cards.”

Musk has told X staff that he plans to offer checking accounts, debit cards, and even loans through X, saying that “if you address all things that you want from a finance standpoint, then we will be the people’s financial institution.”

X CEO Linda Yaccarino has been among the biggest cheerleaders for Musk’s plan to turn X into a bank, writing in a blog last year, “We want money on X to flow as freely as information and conversation.”

https://arstechnica.com/?p=2032306