The technology giant ‘Google’ planned to offer bank accounts to users in partnership with Citi Banking Group. However, it has now scrapped those plans. You may ask why?
There are quite a few reasons why Google is no longer interested in offering bank accounts to its GooglePay users. It said that it is focused “primarily on delivering digital enablement for banks and other financial services providers rather than us serving as the provider of these services.”
Why?
Another reason why the banking ambitions of Google have been killed is that the lead project manager who was overseeing the ‘Google bank accounts’ plan has departed from the company. Caesar Sengupta, the VP left to start his own fintech venture called Arbo Works.
Sengupta earlier said that Google was “looking to make banking more relevant for the mobile-first generation,” as an explanation for its banking plans.
“Our work with our partners has made it extremely clear that there’s consumer demand for simple, seamless and secure digital payments for online and in-store transactions,” a Google spokesperson has said to CNBC in an email. “We’re updating our approach to focus primarily on delivering digital enablement for banks and other financial services providers rather than us serving as the provider of these services.”
Tech Giants Vs Banking
In contrast to its Silicon Valley peer Apple, Google had a disappointing finish while Apple already offers credit cards to its users in partnership with Goldman Sachs. Apple is even exploring a new project to offer its customers buy now – pay later services like Klarna and Affirm.
Other technology companies like Amazon and Uber have also tried entering the fintech space in the past but couldn’t succeed. Amazon, in 2018, planned to offer bank accounts to its customers but that project is yet to come to life. Similarly, Uber had to halt its fintech projects after Peter Hazlehurst left the company.
While financial firs dread that tech giants will dilute the competition and take over the industry, it doesn’t seem close to happening as most tech giants fail to materialize their fintech ambitions. What do you think about this story? Tell us your thoughts in the comments