Google Pay will be able to not only aggregate data from different banks but analyze that data and make special offers.
Google moved a step ahead of its Big Tech rivals in a major relaunch of its Google Pay digital wallet. The relaunch includes three new tabs: Pay, which includes peer-to-peer payments and tap-to-pay transaction history; Explore, for customizable deals and discounts; and Insights, an option to connect your bank accounts to get a searchable overview of your finances. Another opt-in function allows Google Pay to search your Gmail and Google Photos accounts for receipts to integrate into your finance tracking.
While none of the new tabs are exactly new, it is a comprehensive bundle that puts Google Pay far ahead of Apple Pay, Venmo and other wallet options. Jerry Norton, head of financial service strategy for CGI UK, says the relaunch is momentous: “This is much more than a payment app—it’s an open banking app.”
For years, the writing has been on the wall regarding the disintermediation of banks by Big Tech. Yet Norton believes the simultaneous announcement of Google Plex banking service—which will see it partner with an initial 11 US banks in 2021, including Citi, Stanford Federal Credit Union, Bank Mobile, Coastal Community Bank, First Independence Bank, BBVA and SEFCU—brings the most profound change.
“They’re signing up banks to actually provide the back-end service to this front-line service,” Norton says. “I can now use my Google Pay app as my primary banking access, and this is why it’s no longer just a payment app.”
Google will be able to not only aggregate data from different banks but analyze that data and make special offers. “In one fell swoop, Google eclipsed those offerings by banks,” says Norton, as this is something many banks might wish to do, or are nervous or unable to do due to regulatory concerns.
Essentially, Norton says Google stuck itself between the bank and the customer—with the bank providing the infrastructure and Google providing the interface and financial insights.
While banks once lost sleep over becoming mere service providers, the Plex announcement shows they are now willing to partner with Big Tech. It is quite possible some people will now access their bank accounts only via Google Pay, and Norton suggests that banks may feel they have no choice but to get on board because of Google’s reach within certain demographics.