TikTok explores peer-to-peer payments via direct messages

Investing.com -- TikTok is developing a feature that would enable users to send money to each other through direct messages, expanding the social media platform's entry into financial services, Bloomberg reported Tuesday.

The feature under development would use TikTok Pay, which is already operating in Southeast Asia, to process the transactions. Code discovered in the current version of TikTok's U.S. iPhone app revealed evidence of the planned addition.

The code indicates that users receiving money can tap to accept payments before an expiration date. Senders would receive notifications about transaction status through push alerts or their inbox. The code also references an option to include a message with payments, similar to PayPal Holdings Inc.'s Venmo service.

Shares of U.S. money transfer companies including PayPal and Western Union dropped sharply after the news was reported.

TikTok Pay currently operates only in Vietnam, Malaysia and Thailand, where it is used for TikTok Shop purchases. ByteDance Ltd., the global owner of TikTok, may not ultimately launch the peer-to-peer payment feature, but the engineering work suggests the company is exploring this option.

ByteDance, based in Beijing, operates the global TikTok platform and several components of TikTok's U.S. business. The company has been expanding into the fintech sector for years, developing and investing in payment tools to boost spending and user engagement in the video app.

X, formerly known as Twitter, has also moved into financial services under Elon Musk's leadership. Some creators on X have tested new features such as "X Money" to send payments to one another.

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