Tech giant had partnered with Citigroup and other banks on ‘Plex’ accounts that will sync with Google Pay
The new offering, called Plex Accounts, will sync with Google Pay, carry both the Google and bank branding and provide users with a digital dashboard of where and how they spend and save. Plex was billed as a new way to bank, with an emphasis on simplicity and financial well-being and with no monthly or overdraft fees.
The project was expected to start in 2020. A series of missed deadlines, along with the April departure of the Google Pay executive who championed the project, prompted Google to pull the plug on Plex, people familiar with the matter said.
A Google spokesperson said the company will now focus primarily on “providing digital enablement for banks and other financial service providers rather than serving as a provider of these services.”
Google pushed financial products to deepen its relationships with several Silicon Valley giants as well as its customers. Amazon.Com Inc.
Considered offering checking accounts. Apple Inc.
Issued a credit card that was paired with the iPhone. Facebook Inc.
announced that it will create a new cryptocurrency that will facilitate money transfer and commerce.
Many of these expansion plans have stalled. Amazon never went ahead with its checking-account proposal, and Facebook introduced its crypto push after regulators around the world objected and partners fled.
For smaller banks, the appeal of doing business with Google was its engineers’ access to digital information and its vast tech-savvy user base. Smaller banks lack the funds to create the feature-packed smartphone apps their larger rivals offer and their customers want. Plex can level the playing field.
For Citigroup, Plex had to help it overcome its relatively small brick-and-mortar presence. (JPMorgan Chase & Co., America’s largest bank, has nearly seven times more U.S. branches than Citigroup.) Jane Fraser, who ran Citigroup’s consumer division before becoming CEO earlier this year, was promoting Plex. appeared in the video. “It’s a little funny too,” she said.
A Citigroup spokeswoman said the bank plans to offer other accounts to potential customers who signed up for the Plex waiting list. He said the bank would look for other ways to work with Google in the future.
According to a person familiar with the matter, Citigroup was adding about 10,000 people to the waiting list per week, which had grown to about 400,000, which is evidence for officials that the strategy was viable.
The coronavirus pandemic pushed Plex off schedule. Last November, Google said it had signed on more banks, including BMO Harris and black-owned Harbor Bank of Maryland.,
And will start account opening in 2021.
Caesar Sengupta, the architect of the Plex project, left Google in April. Bill Ready, a former PayPal Holdings Inc.
People familiar with the matter said the executive, who joined Google a year ago to lead its e-commerce operations, took over and set a new course. Mr Ready was worried that Plex could make other banks think that Google is out to compete with them because it played a major role in creating the product, one of the people said.
Banking regulators backed Plex and played no role in its demise, people familiar with the matter said. Still, Google informed regulators that it was not going forward with the product before telling all of its banking partners, some said.
As of the end of this week, many banks were under the impression that the project would still go ahead. On Monday, BM Technologies Inc.
said its Plex accounts would arrive in late 2021 or 2022. “Google and BMTX are excited about this opportunity and remain committed to this partnership,” the banking platform said in an email at the time.