Google partners with Banks with the new ‘checking accounts’ feature

Google is the latest tech company interested in gaining a deeper foothold in financial services. The Alphabet INC subsidiary is expected to launch a checking account next year, partnering with Citigroup and Stanford Federal Credit Union.

Google’s new checking account service could help banks win more consumer deposits. Google is partnering with banks to explore ways and means by which it can partner with banks to offer checking accounts through its Google Pay app.

The secret project has a code name called ‘Cache,’ according to sources from the Wall Street Journal. According to analysts, Google’s move is merely for acquisition of more customer data and not for the purpose of making revenue.

Following closely on the heels of the recent partnership between Apple and Goldman Sachs that produced the Apple Card product, Google has planned the launch.

It is believed that Google is planning to enter the fray of banking in order to stay competitive with the other three heavyweights Facebook, Amazon, and Apple.

Checking accounts can provide valuable insight into consumers, including their income, where they shop, and how much they spend. Google won't sell users' financial data, executive Caesar Sengupta told The Wall Street Journal. He pointed out that Google doesn't sell data at all; it merely uses it to target advertisements.

He further stated that Google doesn’t use data from its mobile wallet Google Pay for advertising purposes. From Google perspective, the bank partnerships will give the tech giant a better ability to show advertisers how marketing dollars spent on its system can drive purchases.

At the moment, a lot of the giant tech firms are laser-focused on financial technology. Google is primarily focused on data to feed its core ad business, and less so on acting as a full-fledged bank.

Combing personal data like spending habits is just another extension of surveillance capitalism in the opinion of many skeptics. But according to Google the strategy of helping more people do more stuff in a digital way online, would prove to be good for the internet and for Google, according to Google executive Caesar Sengupta.

Many people believe massive tech firms like Apple and Google becoming financial behemoths is not out of the question, despite the kickback these companies receive from governments. However, the retail giant Walmart had its banking intentions stopped by financial institutions lobbying politicians.