Enabling Technologies

Don’t Give Up on Google Wallet Just Yet; Wait for the Google I/O Conference

MEDICIFounder and Chief Strategy & Innovation Officer

Google is revamping its payments strategy in preparation for positioning its  refurbished Google Wallet head-to-head against competitors like Apple Pay. As reported by Wall Street Journal, Google is planning to bring mobile carriers into the picture. For mobile payment systems like Apple Pay, mobile carriers don’t have  much incentive to  feature it in the iPhones they sell. But Google is planning something different that could see mobile carriers receiving monetary gains for featuring Google Wallet in the phones they sell.

As reported by WSJ, Google will actually pay mobile carriers in the U.S. to preload Google Wallet on the devices they sell. It has been reported earlier that Google intends to buy Softcard, the mobile payments system developed by Verizon, AT&T and T-Mobile. But there is no official confirmation on this yet, and as far as we know, Google is still in the negotiation phase. In purchasing Softcard, Google could provide a continued externally funded incentive to the three mobile carriers for this collaboration.

Considering the mobile payments scenario in the U.S., Apple Pay has been quite the rage. Google Wallet has been in the market for a much longer time compared to Apple Pay, but its uptake has been far below what Apple Pay achieved. The refurbished Google Wallet will certainly aim to be as widespread as Apple Pay. It is expected that Google will make an official announcement about the refreshed Google Wallet at the upcoming Google I/O developer conference this year.

Google is also in talks with payment networks and banks to create a partnership similar to the one offered by Apple, in which processors and banks pay a small fee to the wallet provider, whose security measures reduce their fraud-prevention costs. However, Google’s Host Card Emulation (HCE) security protocol may require banks to upgrade their security, possibly resulting in higher costs when partnering with Google Wallet.

There have been rumors that Google is also in talks with Visa and MasterCard for possible partnerships. Besides mobile carriers, It is expected that Google will partner with banks and retailers, similar to what was done by Apple Pay, using tactics such as increased share of profits. The new Google Wallet may even be more than just a “tap-and-pay” app. We should  expect an entirely new payments platform based around Google Wallet. We are already seeing some evidence of transformation in the current Google Wallet implementation. Recently, Google launched P2P money transfer for Gmail users in UK which is powered by Google Wallet.

Amit Goel

MEDICIFounder and Chief Strategy & Innovation Officer

“Amit Goel is the Founder & Chief Strategy & Innovation Officer for MEDICI. Amit’s vision is to build a strong FinTech market network that involves financial institutions, banks, startups, investors, analysts & other key stakeholders across the ecosystem – helping each one of them in a meaningful way by removing the asymmetry of information and providing a platform to engage & transact.\ \ Amit is passionate about bringing actionable FinTech-focused insights, innovative products & services for the FinTech ecosystem. Some of his work involves startup scores, bank scores/assessments, predictive viewpoints & other innovations that have helped MEDICI’s customers and the ecosystem. He has been named amongst the Top 100 FinTech thought leaders/influencers in the world & Top 10 in Asia multiple times by reputed agencies, consulting firms as well as financial institutions. Amit has built MEDICI (formerly LTP) as a new-age, tech-enabled advisory/research firm, which is now considered the #1 global research & innovation platform for FinTech in the world.\ \ Amit has been writing pioneering viewpoints on financial technology space that have been ahead of the curve since 2010. His data-driven predictions have helped the customers as well as the ecosystem. His past work experience includes a strong background in strategy & market analysis and advisory to clients (from big business houses to Fortune 500 firms) in payments, commerce, financial services & IT/technology. In the past, Amit had also founded a successful consulting & research practice called GrowthPraxis and has worked at Boston Analytics, Frost & Sullivan, and Daimler Chrysler in strategy & research.”