Google Checkout is still behind PayPal and Bill Me Later

According to Rosetta, an interactive marketing agency that inquired the top 100 retailers for the third year in a row, only 11 said they offered Google Checkout payment option vs. 26 for competitor Bill Me Later and 25 for PayPal. Rosetta's inquiry didn’t ask for reasons. But because all three online payment firms charge fees for their services, the withdrawal could be a factor. Google considers that many leading online retailers use Google Checkout.

In general Google has more than 60% of the Web search market in the U.S., far ahead of Nos. 2 and 3 Yahoo and Microsoft. But what about Google’s online payments unit it is different. Its 11% share of the 100 retailers last year is up only 1 percentage point 18om 2007. Google implemented Google Checkout in 2006 with five of the top 100 retailers on board. Compared with, other services did better: in 2007, 21 of the retailers offered Bill Me Later, up from 17 in 2006, and 19 of the retailers offered PayPal in 2007, up from six in 2006. And eBay owns both services.

Google Checkout charges 2% of each sale and 20 cents for each transaction. PayPal charges to retailers rise depending on the amount of purchase, starting with 2.9% on sales of up to $3,000.

Google Checkout lets consumers store credit card and other personal information online, and allows them not to retype it for each transaction. But users still pay with Visa or some credit card. However convenience, there's also the security aspect of Checkout, since users don't have to put all their personal data on a bunch of e-tail sites. And other services, such as PayPal, let consumers pay for items directly from their bank checking accounts instead of with a credit card. 

Some Google Checkout members are large companies, including jewelers Blue Nile and Zales and Dick's Sporting Goods. But most are small businesses.