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North America Paytech Spotlight

From Twitter to the “Everything App”: Can X Transition into a Financial Super App?

Elon Musk has begun a widespread, and sudden, rebranding of Twitter – not long after completing his $44billion acquisition of the popular social media app. Now becoming X, Musk has not been shy in explaining his ambitions to create an “everything app” which could encompass social media, e-commerce, payments and banking. 

The rebranding of Twitter appears indicative of further significant changes to come. The iconic little blue bird gives way to a stylised ‘X’; Musk has proposed changing the name of ‘tweets’ to ‘X’s’; while the @Twitter account is replaced by @X.

Slowly, but surely, all elements of Twitter are being removed and replaced by new X-related variants – presumably until there is no sign of the social media predecessor.

Musk’s motivation behind the change from Twitter to X was partly explained by him on the platform:

The idea of an ‘everything app’ closely relates to the concept of super apps, which have not taken off in the Western world, but instead seeing the most success across Asia – in the form of WeChat.

Brand change “opens up a whole new world of new opportunities”

Initially launched in 2011 as an instant messaging app, WeChat has evolved by implementing social media, payments, ordering food and many more capabilities.

It is this model that Musk appears to be striving towards with his takeover, and subsequent rebranding, of Twitter. But why remove all elements of the ‘Twitter’ brand so soon after spending tens of billions of dollars on it?

Peter Watson, managing director of advertising agency Distract, explains why the transition away from Twitter completely is necessary to achieve its super app aims.

Peter Watson, managing director of Distract
Peter Watson, managing director of Distract

“When a brand’s change of direction is so big, it can be impossible to pivot from the core business itself, hence the need for a complete rebrand. Using Twitter as an example, Elon Musk acquired it to make a much bigger business, ultimately to create X, which would be used as the ‘everything’ app with the added benefit that half of the global population is already a user.

“However, Twitter’s brand credibility is so far linked to being a social network that many of its users would’ve gotten confused as to what it actually was if it was a simple name change. So, changing the entire brand from Twitter to X opens the app up to the possibility of new people and markets.

“The change isn’t a conventional brand tweak; it’s not simply a brand name change. It’s a needed rebrand to allow the app to do so much more than it currently does, opening up a whole new world of new opportunities.”

“Will consumers really trust a controversial brand with their finances?”

On 23 July, Musk tweeted “If a good enough X logo is posted tonight, we’ll go live worldwide tomorrow” and, sure enough, the next day Musk unveiled a new logo across the site.

Twitter X logoThe sudden change saw many users confused, while others questioned the reasons behind the change. Musk’s relationship with the letter X is well documented. Early in his entrepreneurial career, he co-founded X.com – which eventually became PayPal in 2001. His son is famously named X Æ A-12 Musk, and he is also the founder and CEO of spacecraft engineering company SpaceX.

While so many people ponder Musk’s decision-making, trusting the rebranded platform with their financial information may not be at the front of their agendas.

With trust such a key component to embedding financial services and getting users involved, as well as keeping users onboard as significant changes take place, how much can X get away with before it damages its own super app aim?

Mathieu Breton, CTO at embedded finance firm Swan, explains the importance of both regulatory requirements when implementing financial services, but also of building trust with its users: “We’re going to see more and more tech companies wanting to embed financial services – Twitter (or X) is certainly not the first, nor will it be the last.

Mathieu Breton, CTO at embedded finance firm Swan
Mathieu Breton, CTO at Swan

“But the complexity of doing so and the expertise required should not be underestimated. Any business needs to consider regulatory compliance, security processes, etc.

“This is where BaaS companies play a pivotal role in helping brands to successfully embed financial services, managing all of these more complex issues.

“The real issue, however, is that, unlike other brands, will consumers really trust a controversial brand with their finances?”

Combatting a regulatory minefield

With the implementation of financial services into any platform or product comes a number of risks. The regulatory environments drastically differ between the likes of the US, the UK and Europe. If Musk’s super app is going to capitalise on its reported over 300 million active monthly global user base, it will have to ensure compliance across the globe to keep its users safe from growing levels of fraud.

Mat Peck, CTO of Cambridge-based payments scaleup Monavate, explained the challenges of creating a global super app involving financial services: “If Twitter/X could make it possible, it would be great from a financial inclusion perspective.

Mat Peck, CTO of Monovate
Mat Peck, CTO of Monavate

“As with their global remit, they have an ideal platform via which they can bring banking services to unbanked segments, both for consumers and small and medium businesses.

“However, there are fundamental barriers that make these ambitions difficult to bring to market because of the vast differences in regulatory requirements across each country.

“Making banking and financial services globally accessible, and ensuring a universal experience for customers, no matter their location would involve having a team of payment experts specialised in the different requirements for each geographical area or jurisdiction – which is a much bigger and more nuanced task than simply adding banking services may seem.”

X payments “could cause untold amounts of distress to many ordinary people”

Tony Craddock, director general of The Payments Association, explains the reasons behind his concern regarding the expansion ambitions of the project: “Given that a huge percentage of payments fraud happens as a result of interactions between fraudsters and victims when using social media platforms, we should be concerned about Elon Musk’s attempts to transition X into a super app on which he proposes to integrate payments and banking services.

Tony Craddock, director general of The Payments Association
Tony Craddock, director general, The Payments Association

“His ‘move fast and break things’ mantra is all well and good when he’s launching rockets but taking the same attitude towards payments, without some fundamental changes to the platform, could cause untold amounts of distress to many ordinary people.

“Before payments and banking services via X could ever be rolled out in the UK, we would need to see robust evidence that the platform is setting out to eliminate dangerous transactions and ban unregulated UK businesses from using the platform to advertise investments and financial products.

“We would also like to see X and other social platforms like Facebook and Instagram joining with our financial services members to tackle this crime that affects an increasing number of people each year, for example, by helping us to design a central point at which the identity of proven fraudsters is shared so that when they try to steal again through other accounts, they cannot do so.”

Could a super app truly be successful in the Western world? 

Whether X can garner the trust of its large user base is yet to be seen, but another big question remains. Can a super app truly be successful in the Western world in the same way they have in the East? When there have been no major successes in tapping into the concept for American or European users, could X be the first to capitalise?

Gabriel Le Roux on Twitter X
Gabriel Le Roux, co-founder and CEO of Primer

Gabriel Le Roux, CEO and co-founder of payment orchestration infrastructure provider Primer, said: “While some APAC businesses such as WeChat, Grab and Kakao have achieved this vision, this approach may not be a one-size-fits-all solution for other regions. Consumers might still prefer specialised platforms, such as AirBnB and American Airlines or dedicated banking services, such as Revolut, to provide these services separately.

“For example, Uber avoided the super app approach and chose to separate their two lines of business according to the services they offer. However, this could be down to strategic decisions such as geographical expansion and attracting new customers.

“Musk’s move requires many considerations in regard to its current payment stack for the business to thrive and not alienate its current user base. Payment capabilities play a vital role in this type of business model as a super app would need to handle transactions on behalf of sub-merchants, something that requires both a significant user base, a scalable payments infrastructure and a robust brand identity. While Musk’s vision has unsettled many marketers, only time will tell whether Musk’s aspirations come to fruition.”

Author

  • Tom joined The Fintech Times in 2022 as part of the operations team; later joining the editorial team as a journalist.

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