Following trends set up by global tech giants, Google too has decided to enter into core banking and personal financial services. A new report from the Wall Street Journal states, that the search and advertising giant will start offering checking accounts to consumers. The project is named ‘Cache’ and will be implemented by partnering with world’s leading banks and credit unions. The service will offer checking accounts to consumers, while most of the finance and compliance related activities will be dealt by the banks.
In conversation with The Wall Street Journal, Google’s Caesar Sengupta said, that Google will be putting its financial partners more in the foreground than compared with other tech giants in the similar stream. For instance Apple, which has paired with Goldman Sachs for it credit card venture, always appears to be at the forefront of the initiative.
Once again, the whole initiative will revolve around consumer data. While Google has an ocean of consumer data already, it doesn’t have much when it comes to financial data. By entering the financial sector, Google will be able to gain a plethora of information on consumer’s financial behaviors through their account, which is spot on for its core services. This helps banks as well. Google’s tech will be helpful to build loyalty programs in addition to the expected better financial structure. So, now you know why banks are pairing with Google despite having the most to do in the tie up.
Google has had a fair amount of experience in the payments field, where its wallet service, Google Pay, has proven to be a huge success worldwide by providing its users with access to track payments and sharing money with friends. Intrigued by its success, competitors like Apple have also introduced their own payment products in the market, and are also expanding into the credit market with the Apple Card. Facebook also announced Facebook Pay this week, which will consolidate payments from all of Facebook’s subsidiaries under one umbrella. Their controversial cryptocurrency venture ‘Libra’ is also on its way to enter the market.
Google is initiating this venture by getting in partnership with giants like Citigroup and Federal Credit Union. The motivation for this step, as per the Wall Street Journal, is to lure the young and more tech inclined customers, who are more reliant on their smartphones for their day to day life. Sengupta also said that Google’s ability to work on a large chunk of data will be beneficial here.
Sengupta told WSJ;
“If we can help more people do more stuff in a digital way online, it’s good for the internet and good for us.”
Sengupta stressed that the company does not share the Google Pay data with advertisers for monetary benefits. This is a rather strong statement considering the global issue which privacy and data security have become today.