Using an Android as a Wallet

Stephen Yagielowicz

The future of payment systems has come a bit closer, with the Wall Street Journal reporting that search and technology giant Google is working with financial services firms Citigroup and MasterCard on an initiative which would incorporate contactless payment technologies into the Android Smartphone platform.

These systems rely on near field communications (NFC), a type of radio that allows devices to communicate with one another, simply by being within fairly close proximity. This feature has been available from Google since February’s Android v2.3.3 — which included enabling technologies such as an NFC reader/writer API.

It opens the door to a rich experience at the point of sale that retailers really covet.

Think of the possibilities: no more counting cash, fumbling for loose change, or hoping you brought the right credit card with you — simply wave your phone like a magic wand, and your needs will be satisfied. Part of the plan allows users to receive targeted ads (based upon your behavior as a consumer, such as past purchase patterns) and discount coupons, when in range of one of these advanced merchant terminals.

“The project, which is in its early stages, would allow holders of Citigroup-issued debit and credit cards to pay for purchases by activating a mobile-payment application developed for one current model and many coming models of Android phones,” The WSJ report states. “The idea is to turn the phones into a kind of electronic wallet.”

For its part, Google will initially profit from advertising sales, rather than sharing in any processing fees, or taking a percentage of the sale. The company has engaged in talks with retailers that may be interested in testing the new system, with reports that upcoming market trials are set for New York City and San Francisco.

“A phone is a lot smarter than a card,” Veri-Fone CEO Doug Bergeron stated, adding that “It opens the door to a rich experience at the point of sale that retailers really covet.”