Google has announced plans to offer “smart checking” accounts to consumers, partnering with banks and credit unions in the US. The move will see Google join other tech giants moving to provide financial services, according to BBC News.
Launched through Google Pay, the services will allow the use of Google’s analytics tools for conventional bank accounts.
Google will launch its bank accounts in 2020, through partners that reportedly include Citigroup and a Stanford University credit union. These partners will “handle the financial backend and regulatory compliance” according to The Verge.
Google executive Caesar Sengupta said the service, now called the “Cache” project, will “help more people do more stuff in a digital way online.”
Payment and financial services also allow companies like Google and Facebook, which rely on their ability to target ads, to track which ads are leading to purchases. However, Google says it won’t sell financial data to advertisers.
Tech giants ranging including Apple, Facebook, Amazon, and Uber are moving to provide financial services to complement other parts of their platforms, and to become more central to their users’ lives.
Facebook has been working to establish its own cryptocurrency, Apple has launched a credit card, and Amazon has been exploring offering its own bank accounts, as well as a credit card.
But these moves come as tech companies face a widespread backlash over privacy and security issues, raising questions among regulators and the public over whether they should be involved in finance. Many of these projects have encountered regulatory pushback, consumer backlash, or both. Facebook has been asked to halt its cryptocurrency plans, with some of the most established partners already dropping out of the project. Apple’s credit card is now under investigation by New York for its use of “sexist” algorithms.
Google is not exempt from privacy concerns. Earlier this week, a whistleblower revealed that Google is partnering with the healthcare company Ascendant, gaining access to health data from 50 million Americans.
Google says that branding for the banking services will highlight the financial institutions it’s partnering with, rather than Google itself.
“Our approach is going to be to partner deeply with banks and the financial system,” Sengupta said. “It may be the slightly longer path, but it’s more sustainable.”
Other tech companies are taking a similar approach. Apple partnered with Goldman Sachs, and Amazon is working with JP Morgan Chase for its own credit card.
Photo [CC0] via Wikimedia Commons