"We do not have access to any personal information from our partners' credit and debit cards, nor do we share any personal information with our partners", the company said in a statement.
The deal on its own is bad enough, but nobody outside of the two companies apparently knew about it. Customers were not informed their offline spending habits were being shared with Google.
Why it matters: Google's extensive tracking practices continue to come under fire as details involving a deal with Mastercard to link online ads with in-store purchases surface. Later on, if the same user uses his/her Mastercard to buy that item from a retail store, Google sends a report to the advertiser to report the same.
It added that people can opt out of the program using Google's "Web and App Activity" controls. The tool can only recognize your purchase if you were logged into your Google account when you clicked and if you made your purchase within 30 days of viewing the ad. The two companies also discussed sharing profits from ad revenue related to the data, although Google denied this was the case.
While users have the ability to opt out of offline tracking, it remains unclear whether most users even know it exists.
A Google spokeswoman explained, "Before we launched this beta product past year, we built a new, double-blind encryption technology that prevents both Google and our partners from viewing our respective users' personally identifiable information".More news: Ronaldo 'furious' at UEFA award snub, says Allegri
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The arrangement, which customers were not made aware of, gives Google a valuable insight into how merchant advertising is linked to customer spending that is not online. Since at least 2014, the company has used Google Maps to notify advertisers about users who viewed their ads and then visited brick-and-mortar establishments.
A Mastercard spokesperson also declined to comment on the Google partnership directly but pointed out that Mastercard often shares transaction history with merchants and service providers.
Google is an advertising company first and foremost.
According to anonymous tipsters speaking with Bloomberg, Google has had discussions with other credit card companies about partnerships, and ad agencies have approached Google about tracking even more offline information about customers, such as the time of the transactions and how much was spent.
'No individual transaction or personal data is provided. But Christine Bannan of the Electronic Privacy Information Centre told Bloomberg that this burden shouldn't rest on unwitting consumers. "In processing a transaction, we see the retailer's name and the total amount of the consumer's purchase, but not specific items", the statement read.