Alphabet Inc. (NASDAQ:GOOGL) has set sights on the consumer finance segment with its payment app Google Pay. The tech giant has unveiled a new version of the payment app that will let users open bank accounts, pay friends, and manage budgets.
Google Play Upgrade
The upgraded Google Pay app borrows some features from other Google’s products for instance users will be able to link Google Photos to search receipts and link Gmail to see bills. The app will show spending summaries and trends over time. Users stand to earn big rewards based on transaction information.
The Google’s checking and savings accounts will come with zero monthly fees. Likewise it will not have any minimum balance requirements or overdraft charges. Interested users can request debit card that will run on MasterCard’s network
As part of the new drive, the company has teamed up with Citi and Stanford Credit Union for the launch of mobile bank accounts. According to general manager for payments Caesar Sengupta, mobile bank accounts should help make banking more relevant and fun.
In an attempt to take on Paypal Holdings Inc. (NASDAQ: PYPL) and Square, Google plans to let users send peer-to-peer payments. Enabling peer to peer payments on Google Pay is part of Google’s plan to take advantage of growing digital payment amid the pandemic.
Digital Payments Push
Google is not the first tech giant to set sights on the burgeoning finance sector amid growing digital payments. Apple Inc. (NASDAQ:AAPL) has already unveiled an iPhone integrated credit card powered by Goldman Sachs. Facebook Inc. (NASDAQ:FB) is another tech giant that is also making inroads in the finance sector. The networking giant has made it possible for users to make payments via Messenger.
Chinese tech giants Alibaba Group Holding (NYSE: BABA) and Tencent have also not been left behind in pursuit of growth around finance. The conglomerates are big players in payments having invested in mobile payments apps over the years.
Tech giants expanding into the finance sector pose a significant risk to traditional financial institutions. The fact that tech companies own customer relationships and branding could result in banks losing big deals or customers going forward.
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