Google to Test NFC-Based Mobile Wallet?

Google is rolling out a mobile payment service by the end of summer in New York and San Francisco that lets shoppers use their smartphones for purchase transactions, according to a Bloomberg report.

The Internet giant will fund the installation of customized cash registers from VeriFone Systems at retail locations that will accept payments from smartphones with Near-Field-Communication (NFC) technology, according to the Bloomberg mobile payment report.

Google declined to comment on the story.

Currently, the Google-branded Nexus S smartphone made by Samsung includes NFC technology, so it appears this could be a move by Google to extend the reach of its mobile operating system Android. The Nexus S runs Android 2.3, or Gingerbread.

NFC technology is wireless technology that enables users to pay for products and services by waving the handset past a register at checkout or similarly equipped terminal, for instance, therefore bypassing cash and credit cards.

The move by Google to enter the mobile payment sector comes at a time when so-called mobile wallet services are poised to take off, particularly those using NFC.

Bank of America, for instance, just began inviting some customers to participate in a trial to test mobile payments on BlackBerry smartphones in Atlanta, New York, and San Francisco, according to

The BlackBerry mobile wallet trial comes on the heels of a Bank of America iPhone NFC test in the fall in New York City’s subway system. The iPhone was attached to a specially designed case that housed a microSD chip capable of near-field communications. Rather than swiping a MetroCard, the subway system’s traditional payment form, testers waved their iPhones at turnstiles that accepted Visa payWave or MasterCard Paypass cards to pay for their rides.

Mobile payments have been slow to gain mass adoption, but it is anticipated that this will begin to change in 2011 as the number of mobile payment users starts a significant run up from 116 million to over 375 million in 2015, according to a report by research firm In-Stat.

“There appears to be consumer demand for mobile payments,” Amy Cravens, In-Stat market analyst, said in a statement. “Consumers do recognize pain points with current payment systems and indicate support for a cleaner, easier alternative. If mobile operators are able to push beyond the infrastructural challenges and introduce these services to the mass market, the transactional value of the mobile payments market is positioned to grow nearly tenfold over the next several years.”

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