
Google Launches Credit Cards for Small Businesses - Mistone
http://mashable.com/2012/10/08/google-credit-cards/
======
dangrossman
This is a strange offering.

If you wanted to pay for AdWords on credit, why wouldn't you be doing so
already? I assume most businesses are already using a credit or charge card.
And getting benefits like cash back or points for doing so.

If you're already doing that, why would you want to switch to a Google card?
They offer no apparent benefits aside from a _possible_ higher credit limit.
If someone can't get a decent line of credit, would they really spend so much
more on AdWords if given a Google card that they'll be more profitable?

If a business can't get credit at all, why would the banks Google partners
with extend them some?

~~~
dmethvin
I co-founded a company a decade ago that spent most of its marketing budget on
AdWords, on the order of $120K a month. We were _constantly_ running into
issues with the credit card company triggering their fraud algos and killing
our campaigns, despite having these charges regularly coming from the same
company (Google).

At some point if you're Google you get tired of letting the banks skim 3
percent ($3.6K a month!) off the top of these high-volume transactions and
prevent your customers from spending. Google knew we were certainly good for
the money by the time we'd been doing it for a few months. This kind of cash
squeeze is why all sorts of companies get into financing, like GMAC for auto
financing and Dell for computer financing.

------
programminggeek
For some businesses this is probably fine, but at the same time Google has a
long history of being ok with a business one day and the next day deciding
that business is no longer acceptable under Google's policies and shutting
down accounts. How long til Google does the same thing to credit card
accounts? Also, at what point is this business profitable enough that Google
mandates this as a payment mechanism?

~~~
phishphood
this. who do I call when I have issue with Google overcharges or whatever?
last time we had these issue we were told, quote "we (google) are an internet
company and as such we don't have customer service".

------
rm999
Amazon started a similar service very recently:
[http://www.forbes.com/sites/greatspeculations/2012/10/05/ama...](http://www.forbes.com/sites/greatspeculations/2012/10/05/amazon-
wades-into-lending-to-drive-market-place-sales/)

Instead of a credit card it's a loan (which makes more sense to me), but
basically the same idea.

------
Lukeas14
Sounds like 2 genius ways for Google to extract more revenue from their core
service.

One, they'll start seeing increased sales from companies who can now spend
money on Adwords they don't currently have in the bank. This revenue is almost
100% new since the capital was not available before. Although, it's possible
some companies were just using other credit cards to finance their ad buys.

Two, Google would start collecting interest. This doesn't sounds cheap if you
consider the risk of default and actually collecting on those default. But
they could probably sell those loans to collection agencies and still make a
profit.

~~~
sksk
This looks like a co-brand card and so Google will not necessarily collect the
interest revenue. All the risks and revenue are typically borne by the bank
(there may be complex provisions so we will not know the exact deal structure
for sure) and sometimes there will be profit sharing. Google will mainly save
on the interchange (transaction fees) and may have a say on some of
underwriting policies.

------
gojomo
Cross-referencing display ads seen with credit card purchases made could help
'close the loop' on ad campaigns for which conversions are currently harder to
measure.

So perhaps this is a first toe-in-the-water offering, that could grow into a
mass-market credit-card program.

------
elchief
I miss the good old days...dropping $10k a day on adwords on my boss's black
AMEX card.

~~~
icewater
Wow, what business were you in?

~~~
elchief
Telecom startup. Not sure what they exited for, but revenues were $200M when I
left.

------
samstave
"Don't you worry, we got everything you need here in the Company Store! So,
get back to work!"

------
witoldc
I thought it was standard to use a cash back credit card for this sort of
thing.

~~~
MichaelApproved
The real scam was to use cash back or frequent flyer cards to buy money from
the US mint. Apparently they were required to sell $1 coins online to get them
into cerculation. So people were buying thousands of dollars worth of them
(free shipping!) and depositing them right into their bank.

Supposedly you can't do it anymore but I don't remember how they prevented it
while still trying to get the $1 coins into circulation.

