Bank account is valuable, not only for the balance you have at a given time but also for data indicating where and when you spend your money in the bank.
It is, therefore, not surprising that some of the world’s largest technology companies have attempted to collect their financial information.
Apple introduced a credit card in the United States earlier this year, while Facebook was considering creating its currency so users could spend without having to call another company.
Now, Google joins the party. The search engine giant already knows where you work, what you read online, and the places you visited, but he also wants to see you in your wallet.
Google is discussing with US banks the possibility of offering its customers current accounts to accelerate Silicon Valley’s demand for financial services following the launch of Apple’s credit card and Libra’s proposed digital currency. Facebook
Google’s move could further alarm lawmakers already worried about the concentration of sensitive personal information in some large technology companies. With Facebook’s famous opposition to the pound, Google has announced that it will work with existing financial services providers, including its first partners, Citigroup and the Stanford Federal Credit Union.
“We look for ways to partner with banks and credit unions in the US to provide smart checking accounts through Google Pay so that their customers can benefit from useful information and tools.” Budget, a Google spokesperson said in a statement.
As the main competitor of Apple Pay, Google Pay allows the use of smartphones for online and in-store purchases. Google’s spokesman added that the new banking services will adhere to “strict standards for privacy and user control” and that the company will provide more details in the coming months.
“We are excited to offer checking accounts across the country via Google Pay,” Citigroup said in a statement. “Confidentiality and transparency have the highest priority.
A Citigroup spokesman said he would control the banking relationship and that the accounts would follow the same rules as a traditional account. The spokesman said the functionality of Google Pay-based chequing accounts had not yet been established, but the partnership with WeChat’s Asian postal service could serve as a model. Citibank customers make payments and other daily banking transactions. The WeChat platform.
While mobile and online payments such as WeChat Pay and Alipay are already frequent in China, Silicon Valley companies have been slower in the highly regulated world of financial services. Earlier this year, Apple and Goldman Sachs jointly launched a credit card that will allow Apple to buy device purchases and an iPhone application to track expenses.
Cache, Google’s new banking business, is Google’s latest attempt to break into the private finance industry. In 2011, Google Wallet was introduced. It was a way for users to send money. However, before the launch of Google Pay, which has tens of millions of users around the world and is particularly prevalent in India, the market has not yet emerged.
The company announced plans to partner with banks and credit unions in the United States to offer “smart” accounts.
He added that the service, which will be launched via Google Pay, will allow users to add Google’s analytical tools to traditional banking products.
The lawsuit follows offers of credit cards, payment systems, and loans from Facebook, Uber, Apple, and Amazon.
Although the products and the arrangements are different, the technology giants who enter the banking sector share an underlying reason: to become indispensable, declares Gérard du Toit, partner of the consulting firm Bain & Co.
“Everyone is competing to get consumers’ attention, their ecosystem, and platform to win,” he said.
Amazon’s credit cards and business loans aim to expand its e-commerce business, while Uber Money provides credit cards, debit accounts, and money tracking tools to support taxi activities of the society.
Facebook said its Facebook Pay service would complement its messaging tools.
And Google and Apple, who have joined Marcus, the new mainstream arm of Goldman Sachs, with a credit card integrated with Apple Pay and Wallet, want to make iPhones and androids essential.
The financial services entry will also provide information from Google and Facebook for their advertising activities, allowing them to track ads that lead to purchases, said Du Toit.
Changes in the banking sector may intensify debates on tech giants already facing competition, data protection, and privacy issues.
Some officials also expressed concern about the weaknesses in financial supervision as the growing activity takes place outside traditional banks. And in recent days, New York announced that it would investigate Apple after its credit card was based on “sexist” algorithms.
Du Toit said regulatory concerns represented the “fly in the soup” of tech companies.
“They will have to be very careful,” he added.
In many cases, technology companies are working with traditional banks, a sign that they are aware of potential problems.
Google announced that its US partners, which would include Citigroup, would start offering accounts by 2020.
“We are convinced that the regulatory and financial know-how of our partners perfectly complements our experience in creating tools and technologies useful for our users,” the group said in a statement.
Amazon has been offering small business loans since 2011 and launched its credit card with JP Morgan Chase in 2017.
But in some ways, the flood of ads made by companies this year is a sign that the United States is late for the party.
In China and other countries, technology companies have been quick to get into the bank, motivated by the need to fill in the gaps left by the traditional financial sector that created barriers to their operations, whether e-commerce companies or food delivery companies.
In the United States, however, the need was less pressing, partly due to the ubiquity of credit cards and other “pretty good solutions,” said du Toit.
High-tech payment services provided by companies like Alibaba’s Ant Financial and Tencent’s WeChat account for about 16 percent of China’s GDP, compared with less than 1 percent in the US, according to the Bank for International Settlements, an organization supported by 60% central banks.