Why Google’s announcement impacts your CU’s plans

Google confirmed yesterday that sometime next year, it would be offering checking accounts to consumers using mobile platforms. This in and of itself would be big enough news, but as the New York Times reports, one of the “banks” it is teaming up with is Stanford Federal Credit Union. By the way, is it asking major news outlets too much to delineate between credit unions and banks?

Stanford FCU is based in the Bay Area in California. It has $2.8 billion in assets and close to 71,000 members. It is a multiple common-bond credit union primarily serving the educational community. In the press release announcing the partnership with Google, the credit union’s CEO suggested “credit unions across the country can benefit from this type of innovative partnership.” In other words, Stanford has not figured out a way around field of membership restrictions. It is, however, getting a high-profile advertisement for the new product by joining up with Google so soon.

The accounts to be offered will reportedly have special features such as budgeting capabilities, but Google was suspiciously vague as to what features will ultimately be included with the accounts. Additionally, Google announced that it would not share the financial information it receives with third parties, but that’s a lot like Saudi Arabia announcing that it won’t share its oil. The value to Google is in the data that it will use to offer even better analytics on banking and who knows what else.

 

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