Mountain View, California — Making payments for your shopping binges with your mobile phone is one of the great dreams of technophiles, which may have just got hassle-free, with search engine titan Google apparently teaming up with Citigroup and Mastercard to set up a mobile payment system that will turn Android phones into a kind of electronic wallet, the Wall Street Journal said, citing people familiar with the matter.
The report claims that the new technology, which is currently in its early stages and is experimenting with Citigroup issued debit and credit cards, which will enable consumers to wave their Android phones in front of a small reader at the checkout counter to make payments, the Journal stated.
Surprisingly, as you would probably imagine, the technology empowers you to wave your mobile devices in front of an NFC linked credit card reader and it makes the payment from your account.
Simply wave your phone in front of a reader and make payment for your shopping just like that. To make that successful, Google is forging alliance with MasterCard and Citigroup to embed the debit and credit cards technology into the existing Nexus S smartphone as well as future models of Android mobile phones, the Wall Street Journal reports.
In addition to availing targeted offers, users could also manage their credit card accounts and track spending via a smartphone app. The planned payment system would permit Google to offer retailers more data about their customers and help them target advertisements and discount offers to mobile device users near their stores.
Google is not expected to get a cut of the transaction fees, the paper said.
The application known as “near field communication,” which has been operational in Japan for some time. But it is pretty challenging to enforce, since it requires standardized readers at merchants and wireless radio chips built into phones. Nevertheless, the companies are launching an effort to make it happen. If it works, the phone can become your electronic wallet.
The projects major contributor is VeriFone Systems, which makes credit-card readers for cash registers. In the meantime, VeriFone will introduce more “contact-less readers,” or those that can enable consumers to pay by waving a phone over them.
Furthermore, Verizon Wireless, AT&T, and T-Mobile also said last fall that they would team up on a mobile payment system for smartphones last fall. Discover Financial Services said it will process those payments.
However, Google has been actively engaging itself in promoting advertising on its huge platform, and this application is just a step into that direction. Besides, another competitor Apple is also rumored to be toying with the technology, but it is worried about the absence of standards in the market.
According to a study conducted by consulting firm Edgar, Dunn & Co., described that the industry for mobile payments is expected to flourish to $618 billion by 2016. That report is sponsored by MasterCard.
Still in its embryonic stages, Google’s move into the shopping sphere, if successful, will establish it in yet another sphere of business.