Google's announcement is a further step by Gafa into the financial sector: from 2021, the Google Pay app will offer new services, including the ability to open a current account with a partner bank.
Plex" account available from 2021
For the time being, the Mountain View company has not yet announced an exact launch date. However, we already know that the new service offered by Google Pay will be available as early as next year. It will then be possible toopen a current account in just a few minutes from the app, thanks to a network of partner banks.
For the time being, no major French bank has adopted Google Pay, and only online banks Fortuneo and Boursorama have set up a partnership to enable their customers to pay via the application. 6 major French banks have in fact launched another solution, Paylib, which competes directly with Google Pay.
Internationally, however, Google can already count on Citigroup Bank and Stanford Credit Union Stateside (SFCU). A further 9 banks are expected to join the network of partner institutions in 2021. The current account offering, dubbed Google Plex, will require no minimum balance, and charge no overdraft or monthly fees. In addition, a MasterCard debit card will be offered with the Plex current account.
Gafa's incursion into the financial sector
Google, Apple, Facebook and Amazon have all long since grasped the immense stakes involved in a foray into the banking sector. Apple launched a credit card in partnership with Goldman Sachs Group in 2019, Facebook is making progress, despite controversy, on its Libra digital currency project, and Amazon is also working on a current account offering.
Banks possess information on their customers that would make the Gafa envious: income, consumption habits, all this data could give these giants an overview of financial flows, and enable them to score and offer targeted banking products to consumers.
But financial regulators are extremely vigilant: they fear the concentration effect, which would prevent real competition, and the increased risk in terms of risk management in the event of another financial crisis.
As the Financial Stability Board pointed out in a 2019 report on the subject, "these risks can be particularly significant if these financial services are not easily substitutable and if Big Tech's risk management and controls are less effective than those required at regulated financial institutions".