Android Pay is growing like a weed; 60 new U.S. banks and credit unions joined the Alphabet (NASDAQ: GOOG) owned payment solution in one day. Unfortunately no major financial institutions like Bank of New York Mellon were among those supporting the app.
Instead dozens of smaller regional banks and credit unions are now supporting the digital wallet, Android Police reported. Most of the new financial institutions were credit unions, but some small-town banks have apparently jointed as well.
Typical examples of the new financial institutions on Android Pay include the Rock Canyon Bank, the North Texas Credit Union and the Libertyville Savings Bank. The major coup for Alphabet (NASDAQ: GOOGL) here is getting all the credit unions signed up.
Credit Unions Love Android Pay
Credit Unions are exploding in popularity with around 100 million members in 2014, The Washington Post reported. Americans are turning to credit unions because of disgust with high fees and poor customer service at banks. Many people are dumping banks because many local banks have disappeared or been replaced by giant commercial banks.
The next challenge for Android Pay is to get more prestigious financial institutions like Goldman Sachs and Bank of New York Mellon; which cater to the wealthy, to sign up. That might be tough because those institutions have historically been leery of consumer banking and technologies they cannot control.
Will Whole Foods Drop Android Pay and Apple Pay?
One major hope for both Google and Apple is that getting all the banks and credit unions signed up will force retail giants; such as Walmart, Kroger, Target, Home Depot and Aldi, to accept their digital wallets. Big retail has proven highly-resistant to both Apple Pay and Android Pay possibly because of their reliance on Near Field Communications (NFC) technology to communicate with registers.
A major setback might be looming for both apps because a major retailer might drop them. Whole Foods Market (NASDAQ: WFM); which accepts Apple Pay and Android Pay is in the process of being acquired by Amazon (NASDAQ: AMZN). Like Walmart, Amazon does not take Apple Pay or Android Pay so it might drop the apps from Whole Foods stores.