Slideshow 7 Hurdles for Google's Pony Express

  • April 17 2015, 1:31pm EDT
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Google's rumored bill presentment service, called Pony Express, is still in development and has not been officially announced. But the email-based payment service has the potential to disrupt the banking world — if it can overcome the significant obstacles ahead of it. (Image: iStock)

Standalone Bill Pay Never Works

One of the last nonbanks to attempt a standalone bill-pay site was Hearst. The publisher's Manilla website let users pay bills and renew magazine subscriptions, but lasted under four years. Its failure was attributed to low adoption and the inability to find a bank partner to help market the service. (Image: iStock)

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Email Provider Bill Pay Never Works

Do people want to manage their finances in the same place they manage their email? AOL and Yahoo tried to take over bill payments a decade ago. "We found that our users come to our site primarily for news and information," and payments "falls too far outside of our core service," a Yahoo spokesman said in 2007 when his company's bill-pay service shut down. (Image: Bloomberg News)

'Green' Is a Tired Message

Years ago, many banks promoted electronic bill presentment and payment as a way to reduce the use of paper and save the environment. To an extent it worked, but even when the message is well-received, "consumers tend to say one thing and sometimes do another," a Bank of America exec said in 2008 at SourceMedia's Financial Services Going Green conference. (Image: iStock)

Trust of Banks

Banks have long held the advantage of holding a trusting relationship with their customers. But Google may have an edge here: according to recent data from Javelin Strategy & Research, nonbanks like Google and Apple are winning trust away from banks, at least when it comes to digital payments. (Image: iStock)

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Stickiness of Banks

The fact is, bill payment remains a very sticky service at bank websites, particularly as banks have added features such as bill presentment and alerts. Even when bill payment doesn't bring in revenue, bankers still consider it effective. "Bill pay is a sticky service that will help us build deeper, long-term relationships with our customers," Fifth Third told Bank Technology News in a 2012 case study. (Image: iStock)


Many consumers autopay certain bills, whether through a bank or a biller, making it less important for consumers to manage these payments directly. Execs describe bill pay as a way "to not just acquire new customers but to anchor them," and it's intentionally difficult to remove that anchor and migrate consumers to a new service. (Image: iStock)

Gmail Jitters

Another concern for Google: Its Gmail service has a poor reputation for privacy. It's well known that Google targets ads based on the content of users' email, and last year Google's scanning led to the arrest of a Texas man alleged to have used Gmail to store an image of child pornography. Though both of these examples are tied to automated systems — that is, no human is actually reading users' emails on a regular basis — they contribute to a perception that anything sent through Gmail is not really private. (Image: iStock)