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Google has abandoned the plans to offer bank accounts to users

Google has abandoned the plans to offer bank accounts to users

October 5, 2021: -Google is scrapping its plans to offer banking services directly to users.

The shift came almost two years after the company first announced its banking plans and several months after a critical executive leading the project departed.

In the year 2020, Google said it lets users open a bank account through its Google Pay app, in a partnership with Citigroup and Stanford Federal Credit Union, starting in 2021. At the time, Google said that it would offer a service called “Plex” checking and savings accounts that do not have monthly fees, overdraft charges, or minimum balance requirements. Users would have been able to request a physical debit card, which would be running on Mastercard’s network, the company told CNBC.

On Friday, the Wall Street Journal first reported news of the scrapped plans, stating a series of reportedly missed deadlines along with the departure of the Google Pay executive who oversees the project caused it to start to fold.

“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,” the Google spokesperson told CNBC. “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,” he added.

Google’s cloud unit has made financial services one of its main customer focus areas.

While banks express the fear that tech giants will seek to invade consumer finance as they have done with other industries like media and advertising. The threat has barely materialized so far.

Amazon had explored offering bank accounts to its customers in 2018, a project that has yet to materialize. Uber reined in its fintech ambitions with the departure of executive Peter Hazlehurst, and Facebook had to rebrand its crypto project amid a series of setbacks.

A notable exception is Apple, which launched a credit card in 2019 with Goldman Sachs and is exploring a buy now, pays later product with the bank.

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