Google Wallet and the future of money

Its been a big couple of weeks for the future of money game. Both Paypal and Mastercard announced their new initiatives and now Google rolls out the Wallet. Clearly 2011 is not the year of the mobile wallet!

Google is firmly in the NFC camp, as indicated by its abandonment of QR Codes in its Places program.  I believe that any real adoption of mobile payment systems is going to be dependant on NFC technology.  Sure there are stickers and audio work arounds but to acheive the level of convience that mass market consumers will demand, NFC is the only solution.

The other big news about the launch of Google’s mobile payment solution is the partners it is bringing along with it. VISA, American Express and Discover have all agreed to work with Google in addition to its already established partnership with Mastercard.

From NFC Times:

“The announcement by Google that the three card schemes will support its wallet is not surprising, since all had indicated they would be open to working with Google on NFC payments. MasterCard Worldwide was already part of the U.S. Google Wallet launch today, along with Citigroup.”

On Day 1, Wallet supports just one third-party card: the Citi Mastercard.

From the official Google blog post by Osama Bedier, Vice President of Payments:

“When we announced Google Wallet, we pledged a commitment to an open commerce ecosystem. We appreciate Citi and MasterCard for being our launch partners. And today, Visa, Discover and American Express have made available their NFC specifications that could enable their cards to be added to future versions of Google Wallet.

Our goal is to make it possible for you to add all of your payment cards to Google Wallet, so you can say goodbye to even the biggest traditional wallets. In fact, we’ve got a video of our first customer, someone who is ready to replace his famously over-stuffed wallet. We hope Google Wallet gives him “serenity now.”

Techcrunch has a good overview from a user perspective as well as videos that I can’t embed:

“Google Wallet is great, magical, impressive, and all sorts of other positive adjectives. But today’s launch is just a small, but meaningful, first step. NFC-based payments via Mobile is something the world has long unanimously agreed would be awesome, but nearly all of the progress toward it (at least in the US) has been behind the scenes. This is the first time the public has really gotten to play with it — and while it’s going to take a few years (at the very least. Think about how many shops still insist on “Cash Only”.) before it’s ubiquitous enough to kill your wallet, Google seems in it for the long haul.”

It’s a seamless process and it offers tangible value over fumbling through various cards.

Another user review from Mashable:

“If you have never used NFC-enabled devices, it can take a bit of getting used to. The way Google Wallet is set up, it only works if the screen is on and unlocked. If you haven’t used your wallet within a certain period of time, you will also be prompted to enter an unlock code before using the app.

We’ve discussed the security behind NFC systems in the past, and Google has created its own Secure Element that adds an additional layer of security. Google hopes to make this Secure Element an accepted standard within the NFC space.

I liked the process of using Google Wallet. The one frustrating aspect was that my day-to-day credit card, my Bank of America Visa checkcard, couldn’t be tied directly to the system. I do have a Citi-Mastercard and that worked seamlessly with the system (after calling Citibank to get the card activated for use with Google Wallet), but having to use the Google Prepaid Card added an additional layer of complexity that just wasn’t worth the hassle unless I knew I was going to be buying something in advance.”

One thing missing from the big annoucnment was any discussion of Offers. Again from NFC Times:

“But today’s announcement didn’t mention Google Offers, which delivers targeted coupons and other deals to subscribers. Offers is the centerpiece of Google’s business model for the wallet. In a separate development, reports today said Google purchased a Germany-based offers site called DailyDeal.

Google Offers is expected to be trialed in New York and San Francisco, along with Chicago, Los Angeles and Washington, D.C. Most stores are not ready yet, though one, American Eagle Outfitters, is “up and running in some stores,” a Google spokesman told NFC Times.”

About Daniel Davenport

Daniel is a digital media executive with internet and broadcast experience. Daniel is currently the executive strategy director at THINK Interactive.

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