Social networking giant Facebook on Tuesday said that it would launch a cryptocurrency wallet service called Calibra next year that will trade in a virtual currency named Libra as part of efforts to foster global financial inclusion.
"Today we’re sharing plans for Calibra, a newly-formed Facebook subsidiary whose goal is to provide financial services that will let people access and participate in the Libra network," Facebook said in a blog post. “The first product Calibra will introduce is a digital wallet for Libra, a new global currency powered by blockchain technology.”
Libra, as a currency, is being developed by the Libra Association which is a body governed by diverse businesses, non-profit and multilateral organisations, and academic institutions.
"Organisations join the association by running a validator node on the network and serving in governance. An initial group of organisations will work together to finalise the Libra Association's charter and will become the association's Founding Members upon its completion," a blog on the association's site reads.
Some of the organisations involved include PayPal, Vodafone, Uber, eBay, Spotify, Mastercard, Visa and Ribbit Capital.
It is not yet clear whether Libra will be accessible in India as the country has been cracking down on the use of virtual currencies.
According to Facebook, almost half the adults in the world don’t have an active bank account and those numbers are worse in developing countries and even more dire among women.
"The cost of that exclusion is high — approximately 70% of small businesses in developing countries lack access to credit and $25 billion is lost by migrants every year through remittance fees," the blog read.
Calibra, as per Facebook, will be available on Messenger, WhatsApp and as a standalone app. Once launched, users will be able to send money to one another without any extra cost.
The wallet will subsequently offer additional services such as paying bills with the push of a button, buying a cup of coffee with the scan of a code or riding in public transport without needing to carry cash or a metro pass.
The social network also said that it will use similar verification and anti-fraud practices as banks and credit card companies.
“We’ll be using all the same verification and anti-fraud processes that banks and credit cards use, and we’ll have automated systems that will proactively monitor activity to detect and prevent fraudulent behaviour,” Facebook said.
With privacy being an area of concern for Facebook after the Cambridge Analytica imbroglio last year, the company said that the wallet will not share account information or financial data with Facebook or any third party without customer consent.
"This means Calibra customers’ account information and financial data will not be used to improve ad targeting on the Facebook family of products," the firm said.