Google tests mobile payment service

NEW YORK — Search engine giant Google announced the launch of Google Wallet, a mobile payment service that allows consumers to pay for goods via their smartphones. The application is currently being field-tested in San Francisco and New York, and will be available to consumers in the summer.

The new Google Wallet will initially work with a MasterCard from Citigroup and with a prepaid debit card issued by Google, and on one smartphone, the Google Nexus S 4G carried by Sprint Nextel. It will connect only to MasterCard PayPass terminals. There are more than 124,000 PayPass-enabled merchants nationally, according to Google, and more than 311,000 globally.

“MasterCard has pioneered mobile payments with our PayPass technology and we’re proud that it is at the heart of Google Wallet,” said Ed McLaughlin, chief emerging payments officer, MasterCard.

First Data, a provider of electronic commerce and payment processing, is actively recruiting thousands of new merchants in the test areas and will soon expand those efforts to deploy more contactless merchant terminals across the country, Google said.

“The payments industry has known for some time that it was not a question of if, but when true mobile commerce would become a reality. We believe today is the day that mobile meets payments,” said Ed Labry, president, North America, First Data.

Google describes its mobile payment option as a "single-tap" solution, meaning shoppers should be able to pay with a single tap of their phone on a payment terminal, or a swipe past it. The company said it working with point of sale systems companies and top retail brands to create a new “SingleTap” shopping experience whereby consumers would not only be able to pay for an item using a credit card or gift card, but also redeem promotions and earn loyalty points -- all with a single tap of their Google Wallet.

Google is working with VeriFone, Hypercom, Ingenico, VIVOTech and others to develop these next generation point-of-sale systems. Retailers participating in the new SingleTap experience include: American Eagle Outfitters, Bloomingdale’s, Champs Sports, The Container Store, Duane Reade, Einstein Bros. Bagels, Foot Locker, Guess, Jamba Juice, Macy’s, Noah's Bagels, Peet’s Coffee & Tea, RadioShack, Subway, Toys “R” Us and Walgreens.