CASH & CHEQUES
The implications of Google chequing
By Chris Harris
B
ig Tech’s entrance into payments came swiftly in 2019 with the introduction of Apple Card, as well as rising expectations that Amazon, Facebook and Google would also be looking for ways to play in the banking game. Despite Apple Card’s big splash, Apple has not released, at press time, any numbers on growth. But Apple does not need to gain dominant market share to change the industry. That’s because there is something different about this credit card from the others on the market; it is the first to differentiate itself on user experience. This is reflected in Apple’s tag line “created by Apple, not a bank.” Apple Card has redefined the process of applying for and using a credit card, and it has bridged the divide between a physical and digital card. Soon, all consumers will know this can be done and expect it from their financial institutions.
Enter “Cache” Now, Google is entering banking and appears poised to provide the same user-experience layer that Apple has provided with Apple Card. When Google “Cache” — the code name for the chequing account project — was announced in November 2019, the initial information provided was minimal. What we know is that Google is partnering with Citigroup and Stanford Federal Credit Union to provide smart chequing accounts in 2020. 8
PAYMENTSBUSINESS
CNBC reported that Google refers to its forthcoming offering as a “smart checking account,” but the details were left up to interpretation. But providing an experience layer means providing interactions for customers, and that’s something that should make financial institutions sit up and take notice. There are now two tech giants saying, “We can do this better than banks.” And at least two others are also potentially trying to disrupt this industry.
Google will see a huge opportunity to enter the Canadian payment space. What will Google gain? Google’s potential gain from Cache remains speculative. But there are some likely insights we can pull from our knowledge of the company. First, it is no secret that data is at the core of Google’s business model. From search to advertising, knowing how consumers think and behave is key to the company’s success. One of the biggest gaps in Google’s data is how consumers spend their money. This data would allow the advertising giant to better target ads (and charge more for these ads) based on actual spending SPRING 2020
