American Express wants you to know that it isn’t really on board with Google Wallet
Google Wallet’s latest update has made the service a lot more appealing to a lot more people: it now takes all major credit and debit cards that have the American Express, Discover, MasterCard, and Visa logos. This is made possible due to a little workaround that Google devised, which involves a virtual MasterCard that is used for all purchases, which in turn bills whatever personal credit card you choose. That’s pretty clever, if you ask me, but apparently, not all card issuers are happy about this, in particular American Express.
In an official statement to TechCrunch, American Express stated:
We want to make sure Google’s mobile wallet product meets the standards we set for our Cardmembers in terms of transparency and clarity about transaction detail … Right now, American Express does not have an agreement with Google for our cards to be used in the Google mobile wallet.
American Express went on to say it had been in talks with Google about integrating its credit cards into the Google Wallet service, but apparently Google jumped the gun a bit. (Google has a habit of acting now, and dealing with the consequences later.) Additionally, American Express said it could pull the plug on this service at any time, in effect blocking Google Wallet for its customers.
So what’s Google’s response?
For many years, we’ve accepted American Express, Visa, MasterCard and Discover for online and mobile transactions. The latest version of Google Wallet extends these same benefits to people who choose to use the Google Wallet app to make purchases in-store. We are in active discussions with American Express and look forward to working together as partners as the world embraces digital payments.
In essence, Google is right: its Wallet service (formerly known as Google Checkout) has been compatible with American Express for ages. All Google did is expand the reach of its payment services from online to in-person. And I’m fairly certain it would be a legal grey area for American Express to pull support for Google, especially if the two companies have already negotiated contracts, merchant fees, etc. And in any case, I’m sure there would be an uproar from customers if American Express were to do this.
So, long story short, I think American Express is simply throwing a temper tantrum – probably because it hasn’t figured out a way to make more profits from this current setup – but I doubt that it will act on its threats. The backlash would simply be too much.
What do you think?
[TechCrunch]
