It seemed like the perfect partnership. Two absolute giants in the digital sphere working together to make their customers’ lives a little simpler. But even the most perfect looking partnerships can’t last forever and now it seems like the divorce is over, the decree nisi issued and there’s no going back.
Both Google Wallet and PayPal have travelled from very humble beginnings to get where they both are today. The former was established back in 2011 and in its early days the only card that could be used with it was one issued by Citibank. With smartphone development still relatively limited at the time Google also had to produce physical Google Wallet cards that could be used where the app was not operational.
Since then the service has gone through various names including Google Pay but has now reverted to the original Google Wallet. Not only does it accommodate a wide selection of debit and credit cards, but it can also now hold everything from show tickets to store loyalty cards. So, users can feel confident that everything they need is on their phone.
PayPal’s gradual rise has seen a similar trajectory. From a small start-up in 1999 it now has over 430 million users across 200 territories worldwide. It has also moved into many different areas of financial services including providing finance for owners of small to medium-sized businesses through its Working Capital initiative.
Strong as both of these businesses have proved to be together, it seems very much like the parting of the ways will mean pinning your colours to one side or the other.
The story of the split
It was back in April of this year that users of Google Wallet in the US found that they were no longer able to link their PayPal account. It was then announced that, as of 13 June 2025 Google Wallet would no longer allow users to pay using PayPal at all.
For many people this came as quite a blow, especially as many smaller businesses that they buy from tend to rely on PayPal for the service.
Another issue that has arisen is that it is now impossible for uses to see their PayPal transaction history in the Google Wallet. Instead it will be necessary to visit and log in to the PayPal website or look it up in the app.
The reasons for the split have never really been properly explained. PayPal have been the most vociferous stating that the change has been made because “to deliver smart, flexible, and more rewarding ways to pay, PayPal constantly improves their offerings”. Whether this move could ever be considered as an improvement on their offering is a highly debatable point.
Of course it won’t affect every business in the same way. Those that can accept a wide range of payment options will be fine, as will those whose customers don’t use their Google Wallet as a way of accessing their PayPal account. For example, you can still pay with PayPal in online casinos with your mobile provided that the app is installed. With the vast majority of casinos including it as an acceptable payment method it shouldn’t be a major issue.
The partial solution
Anyone who has studied the development of PayPal over the decades will have noticed that it is gradually expanding its services, presumably with the objective of becoming as significant an organisation as the world’s major banks.
This means that it has started adopting some of the major trappings of financial institutions, and this includes issuing its own branded debit cards. Owners of one of these cards will be able to register it with their Google Wallet and continue to use PayPal. While this adds an extra layer of complication, two if you include having to load up your PayPal account with credit, it does provide a workable solution.
The bigger picture
Although it has not been openly admitted by PayPal it could be its ambition to move ever closer to becoming a banking entity that has prompted the split with Google Wallet.
One sign that this may be happening has been the introduction in Germany of a PayPal tap to pay service for anyone with the app on their mobile. So rather being the go-between for remote payments the company now seems to be presenting itself front and centre.
This, in turn, may start to give both Google Wallet and Apple Pay some case for concern. Because if PayPal starts coming for them in a serious way it could well see their currently powerful positions being severely eroded. But that’s still quite a way off in the future. For now Google Wallet has to concentrate on offering the very best and most appropriate service for its users worldwide, with our without PayPal by their side.
