Google wants to start banking with you

Google has expressed intentions to start providing financial solutions to its customers. It divulged plans to offer checking accounts by 2020 and is partnering with Citigroup and a credit union at Stanford University to make it work. This is according to CNN Business.

What this means: This means that Google is not willing to rest on its laurels anytime soon. It is following in the footsteps of tech giants like Amazon, Facebook and Apple. Recently, Facebook launched a cryptocurrency project tagged as Libra. Apple also decided to partner with Goldman Sachs to launch a credit card while Amazon is also thinking of introducing a checking account for its customers.

How it will work: Google will not be the one to be checking the accounts. Brand names of financial institutions will have accounts created for them while banks will be responsible for financial plumbing and compliance. Also, smart checking options would be provided by banks and credit unions willing to partner in the initiative via Google Pay.

In a reaction to the development, a spokesperson for Google said, “We’re exploring how we can partner with banks and credit unions in the US to offer smart checking accounts through Google Pay, helping their customers benefit from useful insights and budgeting tools, while keeping their money in an FDIC or NCUA-insured account.”

Also, Dan Ives, Managing Director of equity research at Wedbush Securities, said Google was repositioning itself for the future. He added that this is just the beginning of new things.

The missing piece is banking. This is just the tip of the spear in terms of where [tech giants are] going,” Ives said.

What you should know: A checking account is a deposit account held at a financial institution that allows withdrawals and deposits. It can be accessed using checks, automated teller machines, and electronic debits, among other methods.

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