Digital-First Banking

Google Expands Digital DDA Program To Six New FIs

Six additional U.S. banks and credit unions (CUs) have signed on to offer checking and savings accounts through Google Pay.

BankMobile, BBVA USA, BMO Harris, The Coastal Community Bank, First Independence Bank (a federally designated minority depository institution) and SEFCU will join Citi and Stanford Federal Credit Union in the offering beginning next year.

“We are thrilled to be collaborating with Google to offer our student customers enhanced digital bank accounts,” Luvleen Sidhu, BankMobile’s co-founder and CEO, said on Monday (Aug. 3) in announcing the bank’s agreement with Google. 

Google’s banking services strategy is an effort to reinvent the banking experience for consumers by enabling them to connect commerce to their customers underlying bank accounts via Google Pay. These “smart DDAs” leverage the Google Pay front end and existing compliant bank account infrastructure to provide consumers with an end-to-end view of their money to more efficiently budget and plan their spend. Consumers get to keep their existing banking relationship, but receive real-time, value-added financial management services based on spending patterns and goals.

BankMobile said in a statement that such a system will enable both the firm and Google to “bring the best of their respective strengths to the table. Google’s expertise in building great user experiences and a highly-scaled and secure infrastructure is a great complement to BankMobile’s financial and regulatory expertise and its unique customer acquisition funnel in the higher education segment.”

BankMobile, a division of Pennsylvania-based Customers Bank, serves about one in every three U.S. college-bound students through relationships with 800 campuses nationwide. Sidhu said the firm’s new contract with Google will allow millions more U.S. students to access the Google Pay app.

“Many of our student customers today are struggling to manage their money as they work part-time and attend school,” she said. “Through our collaboration with Google, we believe we can provide these students with the appropriate financial tools to help them navigate through these difficult situations successfully."

Felix Lin, vice president of payments ecosystems at Google, said partnering with BankMobile will enable a digital experience “that is equitable for all and meets the evolving needs of a new generation of customers. We believe that we can use our technology expertise to benefit users, banks and the entire financial ecosystem.” 

A Google spokesperson confirmed that the tech giant has also reached similar deals with the five other institutions.

“These digital banking experiences [and] built-in partnership will help simplify how users manage their finances,” the source said. “By working with a diverse group of financial institutions, we hope to make the benefits of digital banking accessible to a wider group of people.”

The Google spokesperson added that the new digital bank accounts “will leverage Google Pay’s expertise in consumer tech and secure digital infrastructure to complement the banking partners’ financial and regulatory expertise. Financial institutions will be able to reduce their servicing costs, fight fraud and enhance their consumer offerings. Bank customers will benefit from useful insights and budgeting tools while keeping their money in an FDIC- or NCUA-insured account.”

According to PYMNTS research, although the vast majority of consumers are satisfied with their banks, nearly 40 percent of them would be “extremely” or “very” likely to exploring a primary banking services relationship with a Big Tech or FinTech.

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