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Picasa 3 has recently added some cool features. Moving forward, the next feature introduced is the Text Tool. This feature allows you to add text in the photos. You can also put the text in different directions such as horizontal and vertical. You can create multiple areas of text and customize it easily. In order to customize, you can adjust the font, outlook, size, angle and also drag it anywhere.
Here is an example of the latest Text Tool:
Image Source: Google Photos Blog
To utilize the feature, following are some of the tips as described by Google Photos Blog:
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Using a color that already appears in the photo can be a nice complement for your text.
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Add the same text to multiple photos (a watermark, for example), using the Copy Text and Paste Text options under the Edit menu.
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Create a more subtle looking caption using the Transparency slider.
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Create interesting effects by layering text, especially using different transparency settings.
Image Source: Google Photos Blog

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