Google has launched Google Checkout, a payment system for online retailers. This payment system is integrated with Google AdWords. This is not the much anticipated nemesis of Paypal. However, it has a few forceful features.
Google Checkout uses the same technology that is used internally by Google for its AdWords, Base, Picasa and other services.
"There are more and more reasons for users to do transactions for Google products. We wanted to generalize that experience. It's not about a universal wallet; it's about making the checkout process streamlined with the fewest number of steps" said Salar Kamangar, vice president, product management at Google.
Chris Sherman gives a comprehensive elaboration of the features. Here is the summary-
Google Checkout can be used either alone or as an alternative to existing checkout systems that is being used by the retailer. Google account holders can simply sign into their account on the retailer's web site and then click once to complete the checkout process using the credit card number stored with the Google account. Thus it's definitely easy and hassle free as compared to other payment systems. The program also has email forwarding controls. If you don't want email from a merchant, you can turn off in your own Google account. Google will also maintain a transaction history of all purchases you've made through Google Checkout.
Google is also offering merchant review ratings from Checkout users, and guarantees that users will have no liability for unauthorized use of their account.
Google Checkout should appeal to merchants, as well. Google is making the code to use Checkout available to merchants at no charge, either through simple cut-and-paste code or through a more sophisticated API. Google is also working with shopping cart providers to integrate Checkout into their systems.
Google will charge merchants 20 cents and 2% of a total transaction cost to use the service—very favorable rates compared with PayPal's 30 cents and 2.9% fees (PayPal's fees scale lower with higher-cost transactions). However, merchants who also are Google AdWords advertisers get even more favorable terms.
Google will credit $10 to a merchant for each $1 spent on Google AdWords. For some merchants, this will lower transaction costs for using Google Checkout to virtually nothing. And even though Google CEO Eric Schmidt swore that Google didn't have eBay's PayPal system in its sights when developing Checkout, it's bound to have a significant impact on PayPal's business.
Checkout isn't a person-to-person, stored-value system like PayPal. But with its pricing and ease of use, it's a compelling alternative for businesses of any size that are currently using PayPal as a payment processing system—particularly with its aggressive pricing and incentives for AdWords advertisers to use the system.