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Wednesday, April 22, 2020

April 22, 2020
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When the coronavirus pandemic finally recedes and we can rejoin society, many of us will go through our ritualistic personal pat-down before heading out to make sure we have our keys and phone. What we may not need is our wallet.

Apple , Google , Samsung , Facebook , Amazon and many others are in the midst of a pitched effort to take over our finances. The utopian paradise they promise would finally do away with the wallets and purses filled with money and plastic. In thei
r place would be a series of apps such as Apple Wallet, Samsung Pay and Google Pay. To many of these companies, it's just a matter of time.
"We love this kind of problem," Apple CEO Tim Cook  said when introducing Apple Pay in 2014. "It's exactly what Apple does best."
Six years later, we're closer than ever to Apple's vision. All major credit cards work with digital wallets from Apple, Google and Samsung. Airline tickets do, too. More than 15% of all Starbucks orders come from phones now, the company said in January. Governments around the world are slowly preparing to offer driver's licenses on our phones as well. 
And there's more to come. Google and Amazon are working to build "checking account-like" products, according to reports from The Wall Street Journal last year. Google is said to be partnering with Citigroup and a local credit union to create a debit card to rival the Apple Card, while Amazon is talking to banks including JPMorgan Chase. Apple partnered with Goldman Sachs for its Apple Card, launched last year.
Facebook, meanwhile, wants to replace banks altogether with its Libra project. The digital money, which is designed using cryptocurrency technology similar to bitcoin, is designed to offer an easier way for people to store and spend money, particularly those without a bank account and in poorer countries.
For many of us, the convenience of digitizing our wallets represents more than ditching the plastic we all carry around. It offers a chance to do away with physical cash at a time when the coronavirus pandemic continues to spread without a vaccine or therapeutic drug to hold it back. And it's a way to avoid being caught at the store without the right rewards card or ID ever again.
There's something in it for many of the tech companies too, analysts say. The more we use these services, the more we're likely to stick with the companies we trust to handle our money.
We also leave mountains of data in our wake whenever we travel somewhere or pay for something. Companies can use that to learn what type of food we like, when we like to buy it, whether we're more inclined to eat out or stay home on certain days of the week. People's shopping habits can even expose information about their personalities, such as whether we lack self control, are more civic-minded or have health issues.
"A lot of companies are making money off that data," said Dayna Ford, an analyst following the payments world at Gartner. In the past, credit card companies would sell spending data to analysis firms and retailers to learn consumer behavior. Tech companies are realizing, though, that they can just gather that data themselves if they offer their own payments service instead.
"They can make their devices more intelligent," she said. All they have to do is convince us to use it.

Trust and tech

Our first real taste of digital wallets began with PayPal , established two decades ago as part-security, part-financial company that promised easy money transfers across the web. Its ease of use made it a must-have among people buying and selling items on eBay. 
Fast-forward to today, and the list of ways to tie up your finances with big tech companies is large and growing.
The leading device makers all have "Pays," whether it's Apple Pay , Google Pay, Samsung Pay or Amazon Pay. PayPal, meanwhile, bought the popular social money app Venmo as part of an $800 million acquisition in 2013. Venmo and Square's Cash money transfer app are now among the most popular ways for people to send one another money
The growth of these apps is just the latest sign that people are looking to big tech to handle their money. Industry researchers at McKinsey found in a 2019 survey that while just 35% of respondents trust Facebook to handle their financial needs, more than half trust Apple and Google, and 65% trust Amazon.
And the more trust tech companies can build, the more likely we are to keep coming back to them to buy more devices and services.
Apple's perhaps the most dramatic example of that. It's pushed privacy as a key feature of its Apple Card . In the company's marketing, press conferences and terms of service, it vows not to share customers' data with other companies or use it for anything other than detecting fraud and managing accounts.
Cook frequently declares that products like Apple Pay, Apple Card and the iPhone are the company's key products, not advertising. "You are not our product," he's said. 
Other companies appear to be following Apple's lead, integrating technologies they say make their financial products secure and relatively easy to use. Which will make it all that much easier for us to ditch our wallets when digital driver's licenses start appearing in the next couple years.