Woman paying with her phone at a store.
Google Pay is a digital wallet that allows users to send and receive money, store card information and use that information to pay for items in apps, in stores and online. — Getty Images/ferrantraite

Customers and business owners alike benefit from using mobile wallet options like Google Pay and Apple Pay. The convenience, speed and safety of apps like Google Pay have caused the adoption of contactless payments to accelerate over the last year. Google Pay is projected to add 10.2 million customers between 2020 and 2025, according to TechCrunch. For merchants, offering Google Pay is a simple way to capture more sales with minimal investment. Here’s how to get started.

What is Google Pay?

Google Pay started as Google Wallet, a peer-to-peer payment system (like Venmo or PayPal) for sending and receiving money to friends and families. In 2018, Google Wallet merged with Android Pay to become Google Pay.

Today, Google Pay is a digital wallet that allows users to send and receive money, store card information and use that information to pay for items in apps, in stores and online. It’s a very similar product to Apple Pay (and potentially Apple Pay’s biggest competitor).

[Read more: How to Accept Apple Pay]

As a contactless payment, Google allows customers to pay for their items using an app on their smartphone or smartwatch. It works the same way as Apple Pay, but for Android users. A customer simply downloads the Google Pay app onto their Android device, adds a debit or credit card, verifies the card information, and saves it. Then, the customer can use the Google Pay checkout option when making a purchase online or in person.

Google Pay vs. Apple Pay

There are many similarities between these two mobile payment options. Both Google Pay and Apple Pay allow users to upload credit, debit, prepaid and loyalty cards. They also work seamlessly with a near-field communication (NFC) reader to complete a secure, contactless transaction.

One notable difference is in which devices are able to use Apple Pay vs Google Pay. Google Pay works on most NFC-enabled Android smartphones and watches, but it also offers an app for the iPhone. Apple Pay limits its product to Apple customers only.

Google Pay does not require a customer to open the Google Pay app to complete a transaction. Users simply hold the device near the contactless payment reader. With Apple Pay, a customer must use some type of authentication — fingerprint, face ID, or a passcode — to verify the purchase.

To start accepting Google Pay at your business, first sign up for a Google Pay for Business account.

How to set up Google Pay

To start accepting Google Pay at your business, first sign up for a Google Pay for Business account. Note that you will need a Unified Payments Interface ID (UPI ID) before you begin this process. If you don’t have a UPI ID, get in touch with your bank to get one.

Next, sign in using a Gmail account — either an existing personal account or set up a new one for your business. Google will prompt you through a series of steps to enter your business information, UPI ID, phone number, and a virtual payment address.

Google will then attempt to verify the virtual payment address by sending a small-value transaction to your bank account. Check your account to find the amount, and enter it in your Google Pay account UPI verification screen. This will complete the verification process.

How to accept Google Pay

Once the verification step is complete, the Google Pay team will review your submission and you’ll get an email notification that you’ve been approved to accept payments. The easiest way to start accepting payments is through an NFC terminal. Look for a point-of-sale (POS) system that advertises “tap-to-pay,” or “tap-and-go,” as this system uses NFC technology to establish a connection with each customer’s card or mobile device.

[Read more: Cashless vs. Contactless Payments: Understanding the Difference]

How much does it cost to accept Google Pay? Merchants are charged no fees for accepting Google Pay. For in-store payments, however, card networks consider Google Pay transactions to be card-present transactions and can charge the merchant a fee of up to 4%.

There are other ways to accept Google Pay online and for in-app purchases. Setting up Google Pay for your online store is a little more complicated. First, your website must have a way to add the Google API (Shopify and BigCommerce each have guides to help you get started) and your site must use a Google Pay-compatible payment gateway. There are no additional fees for shoppers who use Google Pay on your e-commerce site.

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Published June 07, 2021