Google Turning Your Smartphone into Your Wallet

Google has just announced that it's working on an app that will enable users to pay for items with their Android smartphone. Google Wallet will also take the place of the user's loyalty cards.

It will use NFC (near field communications) to make transactions, so naturally it will only work on devices with NFC and at stores with the right equipment. Currently, the only Android handset with this very short-range (4 inches or less) wireless technology is the Samsung Nexus S.

Google is working with Citi, MasterCard, and First Data on this app. The intent is to allow users to "tap, pay and save" -- making a payment will automatically redeem any special offers and earn loyalty points. The long-term goal is that things like boarding passes, tickets, ID and keys will also be stored in Google Wallet.

Just Getting Off the  Ground
Google Wallet is still undergoing field testing, and its developer plans to release it soon. Initially, this app will support both Citi MasterCard and a Google Prepaid Card. From the outset, consumers will be able to tap their phone to pay wherever MasterCard PayPass is accepted.

This software will also sync Google Offers, which users will be able to redeem via NFC at participating SingleTap merchants, or by showing the barcode as they check out.

Additional merchants are working to integrate their offers and loyalty programs with Google Wallet, and Google is working to build an open commerce ecosystem.