this is what it can and cannot do compared to a traditional bank.
The technology companies dedicated to the field of finance They have become one of the most relevant trends in this market in recent years, and there have been startups like Revolut that have marked a turning point.
The big tech companies have already made moves in this regard with their mobile payment systems, but now Google is going further. Has obtained a license in Lithuania to operate as a fintech: You will not be able to do everything a bank does, but that gives you access to interesting financial services both in that country and throughout the European Union.
What Google can and cannot do as a fintech
In elEconomista.es they explain how Google has gotten its license “to carry out certain banking services in Lithuania, a country considered to be the most benevolent and agile in this type of procedure.”
This authorization allows Google, and specifically its subsidiary Google Payment Lithuania UAB, to offer various financial services of interest, among which are the following:
- Issue electronic money
- Manage electronic wallets
- Make payment transactions
- International remittances
- Cash deposit and withdrawal services
- Direct debit and credit transfers
It is important to note that the license granted by the European Union enables Google to operate not only in Lithuania, but to establish its headquarters there for these financial services and then extend them to the entire European Economic Area. As our fellow SamaGame members point out, that is precisely what Facebook, licensed in Ireland, or Amazon, licensed in Luxembourg, do.
Although these services are interesting, there will be others that Google will not be able to offer at the moment. This differentiates it from traditional banks or companies such as Revolut, which has obtained a full license in this regard. A) Yes, in these Google services it will not be possible at the moment:
- Offer loans
- Offer mortgages
- Create and operate with investment funds
Lithuania has positioned itself in recent times as one of the countries that grants this type of licenses the fastest in the European Union. The Baltic country has already granted 39 of these licenses, and only the United Kingdom leads it with 128 licenses.
This new capability from Google could of course make it a powerful competitor of smaller fintechs, but here it remains to be seen if Google tries to become a competitor to traditional banking or for the moment remains in that role somewhat less ambitious.
European regulators, yes, will have to be vigilant: the immense amount of data which Google works with – and those who will now add that financial information – could pose a problem for free competition in a particularly sensitive market.
