X Money Goes Live: Banking, Payments, and 6% Yield for Premium Users
X, the social media platform owned by Elon Musk, has begun a nationwide rollout of 'X Money', a new financial service integrated into the app for Premium and Premium+ subscribers. This move is part of Musk's broader plan to transform X into a multi-purpose platform combining social networking, payments, and banking.
The service offers deposit accounts, instant peer-to-peer payments, a Visa debit card, and direct deposit. Users can send money to other X users using their handles without transfer fees, pay bills, send wire transfers, mail physical checks, and receive paychecks. Eligible users may receive their paychecks up to two days earlier than traditional bank deposits.
The X Card, a Visa debit card linked to the service, provides 3 per cent cashback on eligible purchases, no foreign transaction fees, and free ATM withdrawals. It works wherever Visa is accepted and supports digital wallets including Apple Pay and Google Pay. Security relies on passkeys instead of passwords, and users can set transaction limits and add extra verification for certain payments.
Premium+ subscribers can earn up to 6 per cent annual percentage yield on eligible deposits, while Premium subscribers can access the same rate after meeting direct deposit requirements.
X itself does not operate as a bank. Deposit accounts are held through Cross River Bank, an FDIC-member institution based in New Jersey, with standard FDIC insurance covering deposits up to $250,000 per depositor. X also runs a cash sweep programme that spreads customer balances across several partner banks, potentially offering combined FDIC pass-through insurance up to $10 million, though this protection applies only under specific conditions.
The service currently supports only traditional currency, with no Bitcoin, stablecoin, or blockchain-based transfers. However, executives have indicated openness to adding stablecoin features later. X Payments holds money transmitter licenses in 41 states and Washington, DC, but has not yet secured approval in New York or Massachusetts, where regulators are still reviewing the plans.
Senator Elizabeth Warren raised concerns in April about consumer protections, financial stability, and national security risks tied to the service, pointing to past FDIC enforcement actions against Cross River Bank in 2018 and 2023. Whether X Money can clear remaining regulatory hurdles and convince users to adopt it as a primary financial tool remains uncertain.
