March 14, 2017
By John Stewart
Alphabet Inc.’s Google Inc. unit converted its Android-based Google Wallet into a peer-to-peer payment service two years ago, and on Tuesday Google extended that service to Gmail, its popular email application.
With the new feature, Gmail users can send and request money on Android phones, much as they have been able to do with Gmail on the Web. As with the Web version, the Android feature is available only in the U.S. market.
Google, which offers the service at no charge, says in a blog post that only Gmail users can access the feature, though they can then send money to, or request money from, anyone. Gmail has more than 1 billion users, though it isn't clear how many are in the U.S. Nor must recipients download a special app. They may receive or request money directly from the email, Google says, and they can also direct received funds into a bank account.
The functionality behind the Gmail transfers is Google Wallet, which was launched with much fanfare in 2011 as an early effort to bring mobile payments to stores. After four years of slow growth, Google Wallet ceded that market in 2015 to the newly launched Android Pay and was restricted to P2P payments, relying on Mastercard Inc.’s Send money-transfer network and the automated clearing house.
Google’s extension of the email-payment service to Android comes as competition in P2P payments is heating up. A network embracing the country’s major banks is getting set to launch a service called Zelle, while PayPal Holdings Inc.’s Venmo app is racking up usage gains at a torrid pace. Venmo processed $5.6 billion in volume in the fourth quarter of 2016, up 126% in one year. Google does not release figures for Google Wallet.
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