While Google may be the behemoth in web search, its payments initiatives leave a lot to be desired.
There are products coming and going, such as Google payments APIs, as well as surges of support for products that struggle with consumers, such as Google Wallet. Googles latest payments entry, its Pony Express email bill payments, is another step in the philosophy that a user wants all of his or her services in one place.
What is old is new again and the giants of Web 2.0 like Google and Facebook are turning themselves into portals like Yahoo and AOL of the 1990s. Users have shown time and again that they prefer distinct user experiences for different services and Google will have trouble getting everyone to pay bills via e-mail.
For starters, user privacy continues to be a growing concern and users are starting to understand the dangers of having all of their eggs in a single basket. While Google already sees all of your personal information when it scans your e-mail, extremely sensitive data such as your actual bank account and credit card account numbers are usually screened or obfuscated in e-mail. With a bill pay product, you will have to hand over all of the keys to your personal kingdom.
Beyond privacy, customer service and reliability go hand-in-hand are a key differentiator to Google. Have you ever attempted to call Google because of a problem? I dont suggest you do! Unless you are a major advertiser, Google customer service is not really a thing. They drive those huge margins through self-service and technology. If youve ever worked in bill payments before, you know that high touch is sometimes a requirement for last minute or complex payments.
When online bill pay started to roll out to major banks more than a decade ago, via large players like CheckFree, we saw various guarantees and customer service approaches to make consumer comfortable with bill pay. For example, most bank bill pay programs protect you against late payments. Even more to the point, many major billers developed pull programs that debit your account, putting the verification on the billers side, eliminating most fees. It will be a hard sell for Google to convince users they will have an easy time when things go wrong.
Finally, there is the question of inertia. Bill payment is perhaps one of the most sticky features out there. Updating your checking account information, credit card information, or just biller information is time consuming and for most people quite boring. Even if its Google interface is ten times better than your current bank or biller, will you really take the effort to move everything over? If you do, you must really love Google.
As a payment industry, we should never count out technology players. They often have large budgets, a sense of thinking not limited by decades in payments, and the willingness to try and try again. These luxuries arent present across traditional banking and payments players, so we must pay attention to the innovations, successes, and failure. Google will continue to push us to work harder to retain our customers and lead in solution development. Whether Googles Pony Express is a whole new way to pay or just a throwback is something well have to wait to find out.
Matthew Goldman is CEO of Wallaby Financial.