"We are investigating how we can work with US banks and credit unions to provide smart checking accounts through Google Pay, and help customers benefit from useful insights and budgeting tools while saving their money on an FDIC or NCUA insured account, "said a company spokesman.
But Google has no plans to take the center on checking accounts. Instead, the financial institutions' brands will be placed on the accounts, and the banks will be responsible for the financial drain and compliance. Partner banks and credit unions will offer these smart checking accounts through Google Pay. Google has also not decided whether the accounts will charge fees.
Google is trying to deepen the relationship with consumers by entering funding, Dan Ives, CEO of Equity Research at Wedbush Securities, told CNN Business.
"The company has an unrivaled position in the consumer life cycle, and now they are trying to exploit where they are," Ives said.
"The missing piece is bank," Ives said.
Ives said that Google's initiative probably won't cause big banks any concern for now, but Big Tech's ongoing expansion of the economic footprint is likely to pose a competitive threat in the future ̵
Lawyers in Washington, who are already investigating the dominance of big tech companies, are likely to closely review Google's move.
Google's efforts can draw scrutiny given Washington's taste for both Big Tech and big banks, said Jaret Seiberg, an analyst at Cowen and Company, in an analyst note.
"We have trouble seeing how combining the two will produce a result that either Democrats or Republicans will embrace," Seiberg said.
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