Ever wondered what would happen to your Google Wallet funds if Google went belly up, no matter how impossible that seems? Well there is an answer to that question, and it’s one that’ll make you happy. Google Wallet funds will now be FDIC-insured so in the very unlikely event of Google going bankrupt, your money will remain safe no matter what.
The thing is that many payment apps are not backed by FDIC insurance, that’s Federal Deposit Insurance Corporation, which provides insurance for funds held by banking institutions up to $250,000.
Apps like PayPal and Venmo aren’t backed by this insurance but now Google Wallet is. There’s no legal requirement for these money transfer services to have FDIC insurance since they’re classified as “non-banking institutions,” which also include prepaid debit cards and payday lenders.
It’s also highly unlikely that someone will park their entire life savings in services like PayPal or Google Wallet, almost everyone uses these services for the convenience they offer when it comes to quick mobile payments.
Google Wallet users may never even notice that their funds are protected by FDIC-insurance but nevertheless it’s a good safety net to have. Even though the service’s user agreement has not been updated yet to reflect this change, a spokesperson for Google has confirmed to Yahoo Finance that FDIC-insurance will indeed protect Google Wallet users’ funds.
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