Google Making Waves in Credit Card Industry

It may not be long before consumers start hearing “cash, credit or cell?” at the register. On Monday, Google launched their much-anticipated mobile wallet, which is currently available exclusively to anyone carrying a Sprint Nexus S 4G Smartphone via an over-the-air update. This phone is equipped with near-field communications (NFC) hardware, one of the driving technological forces making it possible for phones to act as payment devices, eventually replacing billfolds and coin purses.

Right now, the Google Wallet can be used to pay for goods and services via either a virtual Citi MasterCard or a virtual Google Prepaid Card, both of which can be “loaded” with funds from any of the carrier’s other traditional, plastic credit cards. More payment options are on the horizon.

"Our goal is to make it possible for you to add all of your payment cards to Google Wallet, so you can say goodbye to even the biggest traditional wallets," said Google VP of payments Osama Bedier in a blog post, according to the Information Week website.

Google has already licensed Visa's NFC payment technology payWave, which means that soon Visa-issuing banks will be able to avail customers of the opportunity to add their debit, credit and prepaid accounts to fatten their Google wallet payment options. Google is also working with American Express and Discover to bring them on board.

Stores must have a wireless-capable payment terminal in order for payment by Google Wallet to work, and Google offers an app that consumers can use to assist them in seeking out merchants with PayPass readers.

Ultimately, the Google Wallet will be competing with Apple and ISIS, among others, for control of the mobile wallet market. Apple may or may not unveil their NFC solution with the iPhone 5, and ISIS projects to have its payment system up and running sometime in 2012.

Graham Cluley, a senior technology consultant at the Security software developer Sophos, argues that adopting Google Wallet may not be the most secure option for many consumers. This is because there is a human tendency to choose insecure PINs and passwords, according to Information Week’s website.

"It's hard to imagine that all users are going to choose a PIN code for their Google Wallet which is hard to crack, let alone different from the one which they should be using to protect all the rest of their Smartphone," he said in a blog post as reported by Information Week.

He also brings up the very valid point that cell phone junkies who habitually run their batteries down over the course of a typical day may not, because of battery constraints, be able to access their Google Wallet when they need to.

Jennifer Brown

Jennifer Brown, an external business consultant working with a Fortune 500 company, has years of experience to her credit. Despite having a busy schedule through the day, she takes time out to write articles dealing with credit cards, payday loans and other financial aspects. She has completed her Bachelor degree in Financial Services from Columbia University and has been actively involved in various activities for the betterment of society.