Google Wallet takes on PayPal with text message money transfers

Google Wallet may have been replaced by Android Pay for retail transactions but the former app still has legs: It's gaining a simple money transfer function by way of text message.

Google Wallet money transfer.jpg

Although Android Pay is now the spotlight digital payment service for Google, the company isn't leaving Google Wallet to wither on the vine. In the U.S., you can soon use Wallet to send money via text message to one of your Google contacts.

Android Police notes that the Google Commerce blog announced the new person-to-person payment method that will arrive in a few days in a software update, alongside a recap of other recently added features that could put pressure on similar services such as PayPal.

"When you send money to a phone number, the recipient will get a text message with a secure link. They can simply enter their debit card to claim the money and it will be available in their bank account within minutes."

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Google introduced its Wallet app in September 2011 as a way to use embedded NFC chips inside phones for wireless payments, similar to how Apple Pay works.

The company changed its approach by launching Android Pay this year, and at that point, I thought Google Wallet would slowly fade away.

Not so. Google Wallet is now more of a personal wallet system while Android Pay is meant for consumer to business transactions. The Wallet app no longer supports NFC payments, for example, but it still lives on.

Over the past few weeks, Google has updated the Wallet app to include improved contact suggestions - people you've recently sent money too appear more prominently, for example - a one-touch lock function and the ability to add a second bank account.

And in typical Google fashion, Wallet is supported on both Apple iOS and Google Android devices; helpful since Apple Pay doesn't yet allow for person-to-person money transfers.

I doubt PayPal is going away any time soon, but with an easier way to send money through Google Wallet, it could see additional pressure to keep growing its user base and transaction volume if Google keeps improving and marketing Wallet.