Facebook is finally releasing its digital wallet Novi through a small-scale pilot. However, users won’t be able to trade the Facebook-sponsored Diem cryptocurrency quite yet.
Facebook-owned Novi, formerly known as Calibra, announced the news on Tuesday. The free digital wallet is now available for download as a mobile app, promising zero fees when you send or receive money internationally.
For now, Novi is exclusively focused on helping users based in Guatemala and most states in the US to exchange money online. In addition, the wallet will only support the Pax Dollar, a stablecoin also known as USDP, which is fully backed by the US dollar.
However, Novi says it plans on incorporating Diem one day. “Our support for Diem has not changed,” the company says. “We intend to migrate Novi to the Diem payment network once it receives regulatory approval.”
When or if that regulatory approval will arrive remains unclear. But in the meantime, Novi plans on using the Pax Dollar, which has been around for the last three years, to test the wallet’s systems. The company is also tapping Coinbase to help facilitate the transactions.
Facebook created the wallet with the goal of giving people without bank accounts an easy and secure way to access financial services. “Costs are high and waits are long when people want to send money to their families internationally,” Novi notes. "The current system is failing them, and there is no digital financial architecture to support the innovation we need."
The company’s wallet tries to fill the void by using blockchain technologies to essentially move the money over the internet. “On Novi, 1 USDP is equal to 1 US dollar,” Novi says. “People will send USDP, but their recipients can withdraw the money in their local currency. They can keep the money in their Novi balance or withdraw it by picking up cash at a nearby location or transferring it to their bank account.”
However, a big challenge facing the wallet’s adoption is Facebook’s notorious reputation for data collection and digital privacy. To sign up for Novi, you’ll have to supply a valid government ID and provide a debit card to add money. However, Novi has provided an explainer promising that data shared with the company is often siloed off from Facebook’s own network.
“Your Novi account is separate from your Facebook account and your Novi activity is never posted to your Facebook profile,” it adds.
“Novi will only share information with other Facebook Companies to help us keep Novi safe for everyone, comply with the law, provide basic functionality and allow us to advertise Novi services,” the company says. “Even in these cases, Novi does not share your financial information with Facebook for Facebook’s own advertising purposes.”
You can currently download the digital wallet from the Google Play Store and the Apple App Store. During the pilot, only a limited number of users will be able to sign up. The app is not available for the US users in Alaska, Nevada, and New York.