Now you can really pay as you go: Google to unveil 'mobile wallet' phone that can be swiped as credit card

 

 

By Daily Mail Reporter

 

Last updated at 10:37 AM on 26th May 2011

 

 

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All-in-one: Phiones with Google Android software, like above, will be able to be scanned to make purchases

 

 

 

Google is today set to unveil a new kind of payment system which will allow a mobile phone to be swiped like a credit card.

 

The internet search giant has been working with MasterCard Inc, the world's second-largest credit and debit card network, and Citibank on the project.

It is set to be unveiled in New York and Google has signed up retail partners Macy's, American Eagle Outfitters and Subway for the launch.

However, it isn't yet clear whether the launch will only apply to New York, or will be nationwide, because Google is keeping its cards close to its chest.

 

The company has invited reporters to attend a 'partner event' to demonstrate what it called its 'latest innovations.'

 

Sources say Google plans to unveil a mobile payments system that will run on the Android operating system and will be available on phones from Sprint Nextel Corp.

 

 

That is backed up by the fact that Citigroup, Google, Sprint and MasterCard all declined to comment when asked.

 

The mobile wallet idea was dreamed up around a decade ago and shoppers abroad, especially in Asia, can already wave cellphones at the check-out counter to pay for everything from food to fuel.

 

But it has not yet come to fruition in the U.S. market, hampered by industry infighting, consumer tastes and regulatory hurdles.

 

 

Cutting edge fashion: Macy's department store in New York is one of the retailers that has worked with Google on the system

 

That has not stopped banks, phone makers and technology companies - fearful of being left behind - from trumpeting the concept.

 

Now, a growing number of mobile operators, banks, technology companies and card processing networks such as Visa and MasterCard are vying to gain a foothold in the still-small but high-potential U.S. mobile payments market.

 

Three of the top U.S. mobile carriers - AT&T Inc, VerizonWireless and T-Mobile USA - are also looking for bank and network partners to launch their Isis mobile payments venture.

 

The companies recently scaled back initial plans to build a new payment processing network that would have competed with dominant industry players Visa and MasterCard.

 

Since last year, Visa has tested pay-by-phone technology with several large U.S. banks, including Bank of America Corp and Wells Fargo & Co.

 

'There's room for more than one competitor,' said Google Ventures Managing Partner Bill Maris, speaking about the industry in general.

 

Debut: Google has worked with Mastercard on the new payment system and hopes to beat Visa into the market with the new mobile wallet technology

 

Such services would appeal to consumers if they can help them save money or shorten their time in line at the supermarket check-out, he added.

 

'The experience of buying things will be better, faster, cheaper,' he said.

 

Details are sketchy, but the Wall Street Journal reported Google was unlikely to get a cut of transactions, focusing instead on benefiting by helping retailers target ads and discount offers to Android users close to stores.

 

Currently, credit card companies charge merchants transaction fees. Other players, such as wireless operators AT&T and phone makers from Research In Motion to Apple Inc, are likely to demand a cut of sales.

 

This puts U.S. retailers in the uncomfortable position of possibly surrendering more of their profit margins.

 

• The launch will take place in New York at 12pm EDT (5pm in Britain)
  

 

I have a pre-paid card which does that already :)