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The Rise of MicroPayments: Twitpay

Twitpay is a new micropayment service where users can send money through Twitter. It’s a nifty idea that builds on the simplicity of Twitter.

Twitpay sees the service as a way to quickly settle a lunch tab or small amount of money owed here and there. Michael D. Ivey, CEO, states: “Ideally we want to enable social giving on Twitter…But beyond that, we could enable charitable giving, such as to the Red Cross. We’re very excited to be able to help people do good over Twitter.”
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The New York Times did a nice little write up and explains the process: “For example, posting the update “@johnsmith twitpay $10 for lunch” would deliver the cash to that Twitterer’s Twitpay account. The company monitors the public stream of messages for the keyword “twitpay” and facilitates the exchange. You replenish your Twitpay account using a site like PayPal. Once recipients have accumulated more than $10 in their accounts, the balance can be cashed out in the form of an Amazon gift card. For all transfers exceeding $1, Twitpay will take a flat cut of 5 cents.”

Twitpay is an interesting service, and I am fairly confident it will catch on. Personally, I am not sure I want everybody in my Twitter community knowing who I owe lunch money to, however, I could have seen this program as an asset during the Mumbai crises and the heavy twitter activity then.

The third party additions to Twitter are an interesting phenomena and speak to the unique ecosystem that is building around the service. In the coming month, we will see all kinds of interesting ancillary Twitter services/products arise. As Twitpay’s FAQ page states: the app was created “because Silicon Alley Insider said it was a billion dollar business (and) a billion dollar business sounded good to us.” That sounds good to a lot of (smart) people.