Google’s checking account service may give banks an edge in deposit wars

Google’s new checking account service could help banks in their battle for consumer deposits.

The technology giant said last week its exploring how it can partner with banks to offer checking accounts through its Google Pay app. Citigroup Inc. and a California credit union signed on as initial partners for the effort — a move that could help them pick up extra customers as the industry contends with slowing growth in deposits.

Its a war for deposits, Betsy Graseck, an analyst at Morgan Stanley, said in a note to clients Friday. An opportunity to deliver value to corporate customers and pick up incremental checking accounts as well is a good business decision.