Alphabet Inc’s Google will offer personal checking accounts from sometime next year in partnership with Citigroup Inc and a small credit union at Stanford University, a person familiar with Google’s plans said on Wednesday.
The details of the project, named Cache, were first reported by the Wall Street Journal and follow moves by tech heavyweights Apple Inc and Facebook Inc into the financial industry this year.
Facebook’s plan to launch its Libra cryptocurrency has met with skepticism from regulators, worried about the risk of money laundering and the security of transactions and user data.
But there are also broader concerns about how the big tech companies’ will use their massive digital influence in other areas of business and economic infrastructure.
“Our approach is going to be to partner deeply with banks and the financial system,” Caesar Sengupta, general manager and vice-president of payments at Google, told the Journal in an interview.
“It may be the slightly longer path, but it’s more sustainable,” Sengupta was quoted as saying.
Asked about Google’s plans, U.S. Senator Mark Warner, a Democrat on the Senate panel that oversees banking, said he was “a tech guy”, but that he had some reservations.
Warner told CNBC in an interview on Wednesday his concern was that tech giants like Facebook or Google were entering new fields before there were some regulatory rules of the road in place.
“I think there ought to be very strict scrutiny,” he added.
On Tuesday, Facebook launched a unified payment service through which users across its platforms can make payments without exiting the app, named Facebook Pay, which is separate from its Libra project.
The Google Pay service by the search giant is already popular in countries like India, where it has over 67 million monthly users and is used to pay for everything from groceries to Uber rides.