Google Pay to Seek User Consent for Data Usage in India

Following a three-and-a-half-year presence in the Indian market, Google is preparing to leverage transaction data from its Google Pay users for monetization. However, the company intends to provide users with clear notification and a straightforward option to decline data sharing.

Upcoming Data Sharing Update

Google announced on Thursday that an update to Google Pay will be implemented next week. This update will prompt users to actively select whether they consent to sharing their data with the company.

Currently, Google utilizes user data, based on in-app behavior, to highlight relevant services and promotions. However, the company has, until now, refrained from monetizing users’ transaction data directly.

User Control and Data Privacy

This is set to change with the upcoming update. Users will have the ability to prevent Google from utilizing their data, encompassing both transactional and non-transactional information. Importantly, the default setting will be opting users *out* of data sharing, according to Google.

For users who choose to share their data, Google will employ it to deliver personalized offers. The company has affirmed that it will not display advertisements within the Google Pay app and will not sell user data to third parties. Furthermore, transaction history will remain separate from ad targeting within other Google products.

Transparency and User Understanding

In an interview with TechCrunch, Ambarish Kenghe, VP of Product Management at Google, explained that the purpose of this option is to enhance user awareness regarding the data they share with Google.

Users will retain the flexibility to modify their data-sharing preferences at any time and can also delete records of specific transactions. Declining to share data will not restrict access to any features within the Google Pay application.

Regulatory Context and Industry Practices

Kenghe clarified that this move is not in response to any regulatory directives from New Delhi. He noted that many applications in India already utilize transaction history to offer deals, sometimes employing aggressive tactics. However, Google distinguishes itself by prioritizing transparency in this process.

“We sincerely hope that people will appreciate the ability to easily see and control how their data is used, and enjoy delightful product experiences irrespective of the choices they make on Google Pay,” Kenghe stated in a blog post.

“As India embraces digital payments, we remain committed to bringing the industry along to ensure that we keep raising the bar to deploy state-of-the-art data security and privacy measures and put the users in-charge of how their data is used.”

Google Pay’s Position in the Indian Market

Google, a competitor to PhonePe (backed by Walmart) and Paytm (backed by SoftBank) in India, has cultivated a user base exceeding 70 million on its payments app within the country.

Despite this substantial scale, Google Pay currently does not generate revenue from peer-to-peer transactions, as the underlying Unified Payments Interface (UPI) infrastructure does not support a direct monetization model.

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