Google will soon offer checking accounts to consumers, becoming the latest Silicon Valley heavyweight to push into finance, according to The Wall Street Journal.
The project, code-named Cache, is expected to launch next year with accounts run by Citigroup Inc and a credit union at Stanford University, a tiny lender in Google’s backyard.
„We’re exploring how we can partner with banks and credit unions in the US to offer smart checking accounts through Google Pay, helping their customers benefit from useful insights and budgeting tools, while keeping their money in an FDIC or NCUA-insured account,” a company spokesperson said.
But Google doesn’t plan to take center stage on the checking accounts. Instead, the financial institutions’ brands will be put on the accounts and banks will be responsible for the financial plumbing and compliance.
Partner banks and credit unions will offer these smart checking accounts through Google Pay. Google also hasn’t decided whether the accounts would charge fees.
Google is attempting to deepen its relationship with consumers by entering into finance, Dan Ives, managing director of equity research at Wedbush Securities, told CNN Business.”The company has an unmatched position within the consumer life cycle and now they’re trying to leverage where they are,” Ives said.
Google already offers smart home devices like Nestand Google Assistant and just entered into health and wellness world with its planned acquisition of Fitbit.
„The missing piece is banking,” said Ives.
Ives said Google’s initiative probably won’t cause big banks any concern for now, but Big Tech’s ongoing expansion of its financial footprint will likely pose a competitive threat in the future — especially as it shows no signs of letting up.
„This is just the tip of the spear in terms of where [tech giants are] going,” said Ives.
Big tech companies see financial services as a way to get closer to users and glean valuable data. Apple Inc. introduced a credit card this summer. Amazon.com Inc. has talked to banks about offering checking accounts. Facebook Inc. is working on a digital currency it hopes will upend global payments.
Their ambitions could challenge incumbent financial-services firms, which fear losing their primacy and customers. They are also likely to stoke a reaction in Washington, where regulators are already investigating whether large technology companies have too much clout.
„O singură provizie am făcut, de card, pentru că nu mai umblu cu banii în buzunar. Banii sunt cei mai periculoși când este vorba de răspândirea unei molimi. Am renunțat la cash. În rest, este o prostie să faci provizii. Dacă vine o molimă și nici nu știi când va ajunge, dacă ar fi să se întindă, pe cât timp să poți să faci provizii? Faci provizii pe trei săptămâni, pe patru săptămâni și mai departe?”, a spus consultantul.