Google is moving into mobile payments with the launch of the Google Wallet. Announced in cooperation with the bank Citi, MasterCard, security provider First Data and mobile operator Sprint, the NFC-based Google Wallet is currently in testing and is expected to launch this summer on the Sprint Nexus S 4G handset. Google said it will be an open platform, and invited other banks, payment networks, mobile carriers, handset manufacturers, point of sale systems companies and merchants to join the initiative. At commercial launch, Google Wallet will support payments based on a PayPass eligible Citi MasterCard or a virtual Google Prepaid card. With the PayPass card, users can add it to Google Wallet over the air, using First Data's trusted service manager service. Or, they can fund the Google Prepaid card with any payment card. The payment service will require users to tap their phone at a PayPass-enabled terminal and enter an app-specific PIN. In the first release, all payment card credentials will be encrypted and stored on the secure element, separate from the Android device memory. There are currently over 124,000 PayPass-enabled merchants in the US and more than 311,000 globally.
Google is also working with point of sale systems companies and retail brands to create a new SingleTap shopping experience. Consumers will be able to pay for an item using a credit card or gift card, redeem promotions and earn loyalty points with a single tap of their Google Wallet. Google is working with VeriFone, Hypercom, Ingenico, Vivitech and others to develop these PoS systems, as well as retailers American Eagle Outfitters, Bloomingdale's, Champs Sports, The Container Store, Duane Reade, Einstein Bros. Bagels, Foot Locker, Guess, Jamba Juice, Macy's, Noah's Bagels, Peet's Coffee & Tea, RadioShack, Subway, Toys"R"Us and Walgreens.
The first Google Wallet field tests are focused in New York and San Francisco, where many retailers, Coca-Cola vending machines and even taxis are PayPass-enabled, including major outlets such as CVS, Jack in the Box, Sports Authority and Sunoco. First Data is actively recruiting thousands of new merchants in these areas and will soon expand those efforts to deploy more contactless merchant terminals across the country. Google has also been testing a variety of consumer deals that can range from a 20-percent discount on a new pair of boots discovered on a Google search advertisement, to a USD 5 off check-in offer received upon entering a store, to a "deal of the day" offering a USD 20 lunch for USD 10 at a local restaurant. Whenever customers buy or save an offer, they will be able to automatically sync it to Google Wallet.
