While some tech companies are branding their digital banking products with their own name, Google will use the branding of their financial partners and allow the banks to take care of managing the financial operations of the accounts.
The Wall Street Journal reported Google's plan earlier Wednesday. According to a new report from The Wall Street Journal, Google is also going to get in on the finance industry by offering a Google checking account at some point next year. This clears the company of numerous regulatory headaches that other financial products must deal with, as partners like Citigroup, Inc. are obviously already licensed to offer checking accounts.
The spokesman said Google doesn't plan to sell customers' data to advertising firms. But, for now, the company is only looking to partner with more banks.
The product will launch in 2020 with Citigroup handling most of the financial and compliance requirements, the person said, asking not to be identified because the project hasn't been announced publicly.
Google did not return a request for comment, but Citigroup confirmed to CBS MoneyWatch it was partnering with Google on the accounts.
"This agreement has the potential to expand the reach and breadth of our customer base while complementing our continued investments in digital", Citigroup said in a statement. Well, Google obviously stands to gain a lot of valuable information and insight on customer behavior with access to their checking account, which for many is a good picture of overall day-to-day financial life. It could tell Google how much money people make, where they shop, and what their monthly bills look like.
"High-tech companies are experts at data exploitation and monetization", said Dennis Kelleher, president of Better Markets, which generally pushes for tighter banking regulation.
Surane writes for Bloomberg.