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Google Aims To Leverage Its Millions of Credit Card Credentials for Mobile Commerce
August 30, 2017

By Jim Daly

Google plans soon to give merchants access to the vast trove of credit card credentials it has in its databases to speed customer checkout for mobile and online payments. The search-engine giant, however, is not putting itself in competition with payment card networks, a Google executive said this week.

Connors: “On a mobile phone, buying something with a credit card is a real hassle.”

The service is called Pay With Google, and it could tap data on the “hundreds of millions” of customers Google has on file, including payment card account numbers and related customer information, according to Jack Connors, head of commerce partnerships at Google, the main subsidiary of Mountain View, Calif.-based Alphabet Inc.

Google first disclosed the planned feature among the 101 announcements it made at its Google I/O conference for software developers in May. The service will launch in about a month, Connors said at the Mobile Payments Conference in Chicago.

Pay With Google uses the new Google Payment application programming interface (API), through which merchants will be able to retrieve payment credentials securely and then pass them to their payment gateway or processor, which will decrypt them and do their normal processing. Consumers who have provisioned Android Pay tokens to their phones will see these at the top of the list, but for those who have not yet done that, the cards they have used at Google properties like the Play Store will be offered. The consumer will never see a legacy order form to fill out.

The rationale is to use the card data and related information that Google already gathers from consumers for purchases involving its own products and services, such as the Android Pay mobile-payments service, Chrome browser, YouTube, or the Google Play app store. With that data, third-party merchants could generate more sales by making the mobile or online purchase process more convenient, according to Connors.

Counting card numbers, addresses, and all the other information needed, not to mention typos that require correction, a typical new customer making a mobile purchase has to tap the phone about 120 times, said Connors.

“On a mobile phone, buying something with a credit card is a real hassle,” he said, later adding: “We can streamline conversion pretty much anywhere globally.”

Abandoned purchases, many caused by tedious checkout processes, are one of the biggest fears of online and mobile merchants. Connors claimed that tests with some merchants showed conversion improvements of as much as 3.5 times through Pay With Google.

The initial processor partners announced include: Braintree, Stripe, Vantiv, First Data, Worldpay, Adyen, and ACI Worldwide, with many others expected to update soon, sources say. There is no fee for this service. The merchant uses its existing processor and pays its contracted processing fees.

Connors mentioned that the Amazon.com Inc. model of providing payment services for other retailers became successful because merchants concluded it’s easier to use the card and personal data already on file with Amazon rather than require their customers to enter it again. But he insisted Google aims to improve merchant sales and is not making a run at Visa Inc. or Mastercard Inc., both of which offer streamlined online and mobile checkout through their respective Visa Checkout and Masterpass services.

Google has announced partnerships with PayPal, Visa Checkout, and Mastercard MasterPass in addition to its own efforts with Android Pay and now Pay With Google.

“We’re not actually viewing this as a payments thing primarily,” Connors told the conference attendees. “We’re actually not looking to compete with the networks. We’re looking to work in conjunction with them ... we’re doing it in a way that’s ecosystem-friendly.”

Online-commerce payments researcher Rick Oglesby, president of Mesa, Ariz.-based AZ Payments Group LLC, says an account on file is necessary for one-click checkouts, and merchants increasingly want one-click checkouts even with first-time customers.

“A third party that does know the consumer is needed to facilitate the transaction, and Google is well-positioned to play there,” Oglesby tells Digital Transactions News by email. He also says Google can use account-on-file data to facilitate purchases through fast-growing venues like wearables and voice-based systems such as Google Home and Amazon’s Alexa.

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