It has been suggested that this article or section be merged with Google Checkout. (Discuss) Proposed since December 2011.

Google Wallet is a mobile payment system developed by Google that allows its users to store credit cards, loyalty cards, and gift cards among other things, as well as redeeming sales promotions on their mobile phone.^[1] Google Wallet uses near field communication to "make secure payments fast and convenient by simply tapping the phone on any PayPass-enabled terminal at checkout."

Google demonstrated the app at a press conference on May 26, 2011.^[2] The app was released on September 19, 2011.^[3]

The service will work with over 300,000 MasterCard PayPass merchant locations,^[4] with Visa licensing their Visa payWave system to Google for use in Wallet as of September 20, 2011.^[5]

Availability[link]

Initially, the only phone supported is Sprint's Nexus S 4G, but Google plans to produce NFC stickers associated with one credit card each, to be affixed to non-NFC-capable phones.^[6] Two methods for providing money to the service are advertised, Citi Mastercards and Google Prepaid Card, which can be loaded using any major credit card. During Google Wallet's unveiling at NYC headquarters, Google also touted the openness of their new system. Google said it will partner with all vendors of non-Android phones, including Apple, RIM, and Microsoft.^[7]

On December 6, Verizon announced it is not blocking Google Wallet on its Galaxy Nexus phones, despite rumors: "Google Wallet does not simply access the operating system and basic hardware of our phones like thousands of other applications. Instead, to work as designed by Google, Google Wallet must be integrated into a new, secure and proprietary hardware element in our phones." said a Verizon rep.^[8] This was believed true because Verizon plans to roll out its own payment system, ISIS, in partnership with AT&T and T-Mobile in 2012.^[9] As of April 2012 supported phones include the (Sprint) Google Nexus, LG Viper 4G LTE, LG Optimus Elite.^[10]

Partners[link]

A Google Wallet station at a Peet's Coffee

Google Wallet launch partners include Citi as the issuing bank, MasterCard as the initial payment network, and Sprint as the first mobile carrier.^[11] Merchants who accept Google Wallet include: American Eagle Outfitters, Bloomingdales, Foot Locker, Jamba Juice, Macy's, RadioShack, Subway, The Container Store, Toys "R" Us, and Walgreens.^[12]

In addition, Google Wallet works at other participating MasterCard PayPass merchants including 7-Eleven, Best Buy, BP, CVS Pharmacy, Dairy Queen, McDonald's, Office Max, Petco, Sports Authority, Sunoco, The Home Depot, Tim Hortons and other retailers.

NJ Transit also participates with Paypass and Google Wallet.

Business model[link]

Google won't charge users nor merchants for access to Wallet, and plans to make money by offering sponsored ads to their users. The new app Google Shopper^[13] will push two types of offers to a user's phone:

• Today's offers, which allows the user to see a single offer redeemable for discounted goods or services in their area.
• Nearby offers, which allows the user to see a list of offers in the 'Eat' and 'Play' categories that nearby businesses have submitted through Google Places.

The Google Wallet was designed as an "open" platform. Payment networks, carriers, and banks have been invited to join and participate in the system.^[14]

Security[link]

While a stolen debit card can be used in some circumstance without a personal identification number (PIN) or signature, the Google Wallet requires a PIN and has additional security:^{[15][16][17][18]}

• Google Wallet stores encrypted user information on a computer chip called the Secure Element.
• The Android device itself can be locked with a personal identification number (PIN).
• The Google Wallet app requires an additional PIN to activate the antenna of NFC chip.
• The Google Wallet device must touch or be in close proximity to a MasterCard PayPass reader.
• Once the transaction is completed, the antenna is turned off. Additional transactions require the PIN to be entered again.

The Secure Element only stores data and is required to open the Google Wallet app. The Secure Element memory is separate from the device memory. The chip is designed to only allow trusted programs on the Secure Element itself to access the payment credentials stored therein. The secure encryption technology of the credit card issuing institution protects your payment card credentials as they are transferred from the phone to the reader.^[17]

Security criticism[link]

An analysis by security company viaForensics revealed that some card information stored by Google Wallet is still accessible outside of the application. It is suggested that hackers could create a way to intercept data by eavesdropping on Google Analytics, which monitors apps used on the Android OS. A previous analysis by the same firm revealed a number of other exploits that have since been fixed.^[19]

PayPal lawsuit[link]

Shortly after launch, PayPal filed a lawsuit against Google and two former employees of PayPal – Osama Bedier and Stephanie Tilenius. The complaint alleges “misappropriation of trade secrets” and “breach of fiduciary duty.” The lawsuit reveals that Google was negotiating with PayPal for two years to power payments on mobile devices. But just as the deal was about to be signed, Google backed off and instead hired the PayPal executive negotiating the deal, Bedier. The lawsuit notes that Bedier knew all of PayPal’s future plans for mobile payments, as well as an internal detailed analysis of Google’s weaknesses in the area. Not only that, it accuses him of storing “confidential information in locations such as his non-PayPal computers, non-PayPal e-mail account, and an account on the remote computing service called ‘Dropbox.’”^[20] It should be noted however that Google has run a competitor to PayPal, Google Checkout, since 2006, which was replaced with Google Wallet.

Privacy[link]

Privacy concerns include the storing of data regarding payment information, transaction details, payment attempts and other information stored by Google indefinitely. The Privacy Policy for Google Wallet indicates that much of the data is stored but may not be shared outside Google except under certain circumstances. The Privacy Policy also indicates that transaction details are not "currently" stored by Google, leaving speculation that users' transaction details may be stored at some point.^[21] The storage of such personal information about users' transactions is of significant financial value to a company that earns much of its revenue from data, but may be controversial to users aware of the policies.^[22]

See also[link]

• Google Checkout
• M-Pesa
• Near field communication (NFC)
• Osaifu-Keitai

References[link]

External links[link]

• Official website
• FAQ