Continuing the trend of big-tech companies entering the world of finance, search engine giant Google has announced that it will begin offering checking accounts to customers in 2020, according to the Wall Street Journal.
The accounts will be offered through a partnership with Citigroup. Referred to as “smart checking accounts,” users who sign up can link their accounts to their Google Pay digital wallets. They will also be provided with budgeting tools and direct deposit options for workers looking to stash their paychecks away. Additional banks could also join forces with Google in the future.
“We’re exploring how we can partner with banks and credit unions in the U.S. 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 spokesman explained to CNBC. “We look forward to sharing more details in the coming months.”
Google’s plunge into digital finance draws comparisons with Facebook’s entry to the financial sector through its “stablecoin” project Libra. The Facebook-led Libra Associate has said that the digital currency will be backed by several forms of fiat and designed to serve as a global means of payment for social-media users looking to purchase goods and services through Facebook and other apps.
And, like Libra, Google’s monetary plans appear to be garnering mixed reactions, with some worrying about a company as notoriously invasive as Google gaining access to their financial data. One such concern comes from Brian Foran, a banking analyst with Autonomous Research.
Speaking with CNBC, Foran stated, “They’ll have this window into my financial life. They’ll see my paycheck, my spending habits, mortgage payments and credit cards. I’m not sure I’d feel comfortable with a Google bank account.”
Both Facebook’s and Google’s forays into the world of digital finance come at time when decentralized finance (DeFi) products are gaining in popularity. DeFi projects such as Compound, InstaDApp, and dYdX, similarly aim to expand financial services to people across the world, though do so with the promise of remaining non-invasive of users’ data and privacy.