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Instagram adds in-app checkout as part of its big push into shopping

Is this Facebook’s next big business?

Instagram took its next step to becoming a full-fledged commerce business today, announcing that it is bringing a checkout feature to its mobile apps. With checkout, you can store your payment information with Instagram to make purchases more quickly. In return, Instagram is charging retailers a selling fee. More than 20 brands will use checkout to start, including Nike, Adidas, Dior, H&M, MAC Cosmetics, Michael Kors, Oscar de la Renta, Prada, Uniqlo, Warby Parker, and Zara.

Items eligible for in-app checkout now have a big blue “Checkout on Instagram” button below them. Tap it and you’ll be asked to provide your email address so that the seller can complete your order. From there, you enter your delivery information and payment method, and after reviewing your details you can place the order.

Previously, completing a purchase on Instagram has required using a pop-up web view on the retailer’s site, where users are more likely to abandon their shopping carts in frustration. Instagram hopes that allowing people to complete their purchases inside the app will inspire them to shop more — and to create a big new business for parent company Facebook, which has recently signaled that it expects commerce and payments to represent the future of the company.

For now, payment information stored with Facebook will only be used on Instagram. But it’s easy to imagine Facebook letting you use your credentials elsewhere in its family of apps. (The company is also working on a separate payments product involving the blockchain and WhatsApp.) In the meantime, Facebook says it won’t share your payment information with other users or with retailers.

Instagram believes shopping represents a massive new business opportunity. The Verge reported last year that the company is building a standalone shopping app. It also said Monday that 130 million people a month tap on product tags in shopping posts.

“Checkout is just one part of our long-term investment in shopping,” the company said in a blog post. “We’re excited to introduce even more ways for people to enjoy shopping on Instagram this year.”