The highly anticipated payment service Google Checkout was launched Thursday by the eponymous search-engine giant. Initially referred to in news reports as Google Wallet or GBuy, Google Checkout processes online transactions between customers and e-tailers. Checkout also stores names, addresses and credit card information -- so that customers need not reveal this information directly to sellers -- and is responsible for keeping the data safe. The services provided by Checkout are much like those of PayPal, which is owned by eBay--one of Google’s biggest advertisers.
Although the services offered are similar, the costs of PayPal and Checkout are different. PayPal’s fees run from 1.9 to 2.9 percent of the purchase plus 30 cents per transaction, whereas Checkout charges retailers a fee of 2 percent of each transaction plus 20 cents for processing. Checkout is likely to appeal to small businesses, since Google pays all credit card company fees.
The biggest factor separating Google Checkout from its competitors is its integration with AdWords, Google’s search advertising program. Advertisers are rewarded with $1 in free sales processing for every 10 cents spent on AdWords. Forrester analyst Charlene Li said, “If Google helps Web retailers sell more, they could be persuaded to spend more money on AdWords.” Search results will display participating retailers next to a shopping cart icon.