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Alphabet's (GOOGL) Google Brings Google Wallet to South Africa

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Alphabet’s (GOOGL - Free Report) division Google is consistently working toward expanding its footprint in the global digital payment space.

Reportedly, the tech giant introduced Google Wallet in South Africa.

Per the report, cardholders of FirstRand Bank, Discovery Bank, Investec, Standard Bank, ABSA and Nedbank can add their cards to Google Wallet.

Users of the mentioned banks can store debit and credit card details on the wallet and seamlessly make contactless payments with their Android phones or Wear OS devices.

The latest move is expected to help GOOGL expand its reach among the merchants and customers in South Africa, where digital payment transactions are proliferating.

This, in turn, is likely to drive Alphabet’s revenues in the near term.

This is anticipated to help GOOGL win investor confidence in the near term and the long haul.

Shares of GOOGL have been down 19.5% in the year-to-date period, outperforming the Computer and Technology sector’s decline of 24.5%.

Global Expansion of Google Wallet

Alphabet introduced Google Wallet in 39 countries after it showcased the Google wallet revamp at the I/O developer conference in May.

In the second round, apart from South Africa, Alphabet rolled out Google Wallet in five more countries, including Moldova, Qatar, Serbia, Azerbaijan and Iceland.

Reportedly, Google Wallet users in Azerbaijan and Iceland can make payments using Android phones. Users in these regions can avail of the feature of paying through Wear OS smartwatches in the coming months.

Google Wallet will replace the existing Google Pay app and provide users with a comprehensive digital wallet comprising innovative features and support for digital IDs, loyalty cards, boarding passes, transit cards, digital keys, et al. With Google Wallet, Alphabet aims to provide an enhanced digital wallet experience to users.

Competitive Digital Payment Market

The aforesaid global efforts will continue to help Alphabet expand its presence in the booming digital wallet market, where growth is attributed to the increasing adoption of Internet and mobile phones in the developing nations, and the coronavirus pandemic-led rise in contactless payments.

Per a Transparency Market Research report, the global mobile wallet market is expected to be worth $16.2 trillion by 2031, seeing a CAGR of 22.2% during the 2022-2031 forecast period.

The digital payment market is likely to hit $204.1 billion by 2028, witnessing a CAGR of 15.1% between 2022 and 2028, according to a Vantage Market Research report.

Given the potential in the digital payment market, other than Alphabet, major companies like Apple (AAPL - Free Report) , Amazon (AMZN - Free Report) and PayPal (PYPL - Free Report) are making strong efforts to bolster their presence in this space.

Apple is continuously working toward expanding its digital payment services worldwide on the back of its mobile payment service, Apple Pay. AAPL’s partnership with top merchant banks is constantly helping it gain momentum among its customers. Users can add their cards to Apple Pay to avail of a secure transaction along with rewards and benefits.

Amazon gained strong momentum among customers globally with its online payment service Amazon Pay. With this, users can shop fast and safely on the e-commerce platform. Users can also make bill payments, buy insurances and travel tickets, and access rewards and gift vouchers.

PayPal continues to gain solid traction in the global online payment market on the back of its robust products. Moreover, PYPL’s peer-to-peer payment service Venmo is driving its active accounts base with strong monetization efforts and robust features. PYPL’s strong connections with global financial service providers are helping it expand its customer base, which is a positive.

Apple, Amazon and PayPal have lost 4.3%, 17.6% and 48.7%, respectively, in the year-to-date period.

We believe that Alphabet’s consistent initiatives in the digital payment space will continue to help it gain a competitive edge against peers.

Currently, Alphabet currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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