Google May Acquire Mobile-Payments Company Softcard
Google is readying to compete with Apple, Amazon and PayPal as it makes another push in mobile-payments solution. The search giant is said to be in talks to acquire Softcard, the mobile-payments company, according to The Wall Street Journal.
Softcard was a joint venture between carriers AT&T, Verizon and T-Mobile, created with the aim to bring a unified platform for a “contactless” NFC mobile payments solution. The payments company has its app available for Android and Windows Phone devices, which is said to be acceptable for payments over 200,000 merchants in the U.S., including Subway and McDonalds.
Users can activate payment cards from American Express, Chase, Wells Fargo and other banks in the Softcard app.
The acquisition deal for the payments company is reportedly under $100 million. However, both Google and Softcard declined to comment on the possible buyout.
“We don’t have a comment, background, deep background, off-the-record steer, nod, wink or any other verbal or nonverbal response to these sorts of rumors,” a Google spokesperson said.
Multiple tech giants these days are making efforts to dive into the lucrative mobile-payments industry. Even Apple introduced its mobile payment and digital wallet service called Apple Pay in October 2014, that lets users make payments using their iOS devices. The service was highly adopted as more than 1 million credit cards were registered on Apple Pay in the first 72 hours of its debut.
Being a search-engine giant, Google has a good reason to invest in the payments solution domain. According to a report by Forrester Research, consumers are expected to purchase $142 billion worth of goods using mobile-payments services by 2019, up from $52 billion in 2014.
However, Google doesn’t have good memories with payments. It was one of the payoneer companies to offer the mobile payments with a service called Wallet. But the service couldn’t get customers traction, and Google announced in November to shut down the service for digital goods.
Amidst the buyout rumors, TechCrunch has reported that Google is actually interested in Softcard’s patents, or more specifically what appear to be applications for patents. The company has just over 120 in all.
The mobile-payments company is currently in a consolidation phase and laid off about 60 employees last week as part of that restructuring. Softcard said it’s taking steps to reduce costs and better position itself in the marketplace.