Google is giving up plans to supply customers Plex financial institution accounts
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Google is abandoning its plans to offer banking services directly to users.
The move comes almost two years after the company first announced its banking plans and several months after the departure of a key executive who led the project.
In 2020, Google said it would allow users to open a bank account through its Google Pay app, in partnership with Citigroup and Stanford Federal Credit Union starting in 2021. At the time, Google said it would offer a service called “Plex” Checkout offer and savings accounts with no monthly fees, overdraft fees or minimum balance. Users could also have requested a physical debit card that would have run on Mastercard’s network, the company told CNBC at the time.
The Wall Street Journal first reported the abandoned plans on Friday, saying a series of alleged missed deadlines along with the departure of the Google Pay manager overseeing the project caused it to begin to fail.
A Google spokesperson confirmed the report to CNBC but declined to comment on the executive’s exit effects.
“Our collaboration with our partners has made it extremely clear that there is consumer demand for simple, seamless and secure digital payments for online and in-store transactions,” the Google spokesman said in an email to CNBC. “We’re updating our approach to focus primarily on delivering digital opportunities to banks and other financial services providers, rather than acting as the provider of those services.”
Google’s cloud unit has also made financial services one of its main customer focus areas.
While banks have voiced their fears that tech giants will attempt to break into consumer finance as they have done in other industries like media and advertising, the threat has barely materialized so far.
Amazon reportedly investigated offering bank accounts to its customers in 2018, a project that has not yet materialized. Uber curbed its fintech ambitions last year with the departure of Peter Hazlehurst. Facebook had to rename its crypto project amid a series of setbacks.
One notable exception is Apple, which successfully launched a credit card with Goldman Sachs in 2019 and is reportedly considering a product to buy, pay later at the bank.
Caesar Sengupta, former Google Vice President and General Manager of Google Payments and “Next Billion Users,” told CNBC in 2020 that the company “wanted to make banking more relevant to the first generation of mobile” as an explanation of its banking plans.
Sengupta left Google in March to start his own financial technology company called Arbo Works, according to his LinkedIn. Since then, he appears to have been recruiting several long-time Google employees for his company, according to the LinkedIn and Arbo Works website.