December 11, 2015
A new update to Google Wallet today enables users to send money to anyone in the contact list using a phone number. The new version of Google Wallet app will become available on Google Play and App Store in the next few days, as promised by Google.
Before the update, sending money required an email address. With elimination of the requirement, Google Wallet simplifies the process to deliver a seamless experience.
Especially exciting is the fact that the recipient is not required to have Google Wallet to claim the funds. With this update, a recipient will receive a message with a secure link and can have money transferred right into a bank account by entering the debit card information. According to Google, funds will be available in the account within minutes.
Among other updates in Google Wallet are improved contact suggestions that will bring to the top contacts that users are sending money to the most. Google Wallet now also allows linking a second bank account.
Security wasn't ignored in the update: there is a new option to block the app by tapping a button. Also earlier this year, Google Wallet funds got even more secure with FDIC insurance.
With the rise of contactless payments options, Google Wallet had started losing its relevance. Apple Pay, Samsung Pay, Android Pay by Google, and now Walmart Pay - Google Wallet needed to make a shift from payments to P2P transfers to provide enough value.
It is not clear yet if the new feature will boost usage and adoption as there are other services offering excellent user experience when transferring funds. However, Google Wallet now has two clear advantages that have not been outpaced yet - no requirement to have a Google Wallet account to receive funds and availability of those funds in a bank account within minutes.
With rising anticipation of faster or real time payments in the US, it seems that Google Wallet has taken a step forward for the whole payments industry towards real-time transfers to bank accounts. It remains to be seen how this service will be priced and how other players will respond to this move.