Even as its shares have fallen off a cliff of late, social networking kingpin Facebook's (NASDAQ:FB) 2014 performance is still easily outpacing that of its benchmark, the Nasdaq Composite.

2014 has been arguably one of the biggest years in Facebook's relatively brief corporate history for a number of reasons. With its shares soaring over the past year, Facebook has turned to largely stock-based buyouts to execute several multi-billion dollar acquisitions, most notably Facebook's $19 billion purchase of social messaging platform WhatsApp in February and its $2 billion buyout of virtual reality start-up Oculus VR in March.

Perhaps even as a sign of its maturity, Facebook is clearly looking to tackle big problems and attempt to disrupt gigantic markets. Its business strategy has no time for small potatoes. And in another recent example of this dynamic at Facebook, a report has surfaced detailing Facebook's plans to enter another multi-billion dollar market -- mobile payments.

Let's see if this makes sense for the likes of Facebook and its investors.

Facebook and mobile payments: Can it really work?
That's the several billion dollar question that Facebook investors must wrap their heads around in order to take any kind of investment action.

There's certainly a case to be made that Facebook could provide a useful platform for the transfer of money between friends, which is becoming an increasingly popular payment type these days. According to reports, Facebook is close to gaining approval from the Central Bank of Ireland to launch a service that would enable Facebook users to store and transfer money to other users on the social networking site.

There's certainly a case to be made that adding the ability to safely and securely send payment to your Facebook friends could prove attractive for Facebook users. However, it also brings up the question of whether the average user will be willing to trust Facebook with their credit card information on top of the other heaps of personal data Facebook already has about its users. There's certainly the possibility for the "big brother" moral hazard to keep Facebook's mobile payments service grounded, just as privacy advocates often deride Google for its ever-increasing reach into aspects of our everyday lives.

Join the crowd
If it ultimately opts to enter the mobile payments space, Facebook will be joining an increasingly crowded market, one in which eBay's (NASDAQ:EBAY) PayPal unit appears to have gained an early lead.

According to reports, eBay's PayPal saw its mobile payments volume double last year to around $27 billion, leveraging the already massive installed base of both consumers and businesses that PayPal and eBay have established over the past decade. Here, too, eBay and PayPal hit on the same convenience factor that Facebook's likely to use as a sell for its own mobile payments platform.

But even though eBay and PayPal enjoy some formidable inroads, this space is so new that Facebook -- or Apple or Google -- could also carve out a room for itself in the years to come. Estimates vary, but it's generally agreed that the mobile payments industry as a whole is set to balloon in the years to come to processing transactions valued well into the hundreds of billions of dollars .

So at the end of the day, this is only an emerging storyline for Facebook users, but one that Facebook could quite plausibly gain share in by creating a seamless payment transfer network between the pre-existing social connections it alone possesses. The mobile payment wars are just heating up, but Facebook and its investors certainly could stand to gain by moving into this mobile growth market.

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Andrew Tonner owns shares of Apple and eBay. The Motley Fool recommends Apple, eBay, Facebook, Google (A shares), and Google (C shares). The Motley Fool owns shares of Apple, eBay, Facebook, Google (A shares), and Google (C shares). Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.