LOUISVILLE, KY - Mobile Payments Today reported earlier this week that Google will announce at its Google I/O annual conference later this week a reboot of its Google Wallet mobile payment service.
"Google Wallet 2.0," as sources have called the reboot, will address a critical lack of support among credit card issuers. To date, only CITI has joined the Google Wallet.
"There is an overwhelming amount of technical orchestration required between an issuer and its TSM to enable NFC payments for its cards," the source said. "A lot of issuers are wary of committing to that without evidence of ample upside for enabling NFC payments."
With only one issuer, the wallet has found modest consumer adoption because users have to be issued a virtual credit card from CITI or pre-load funds onto a CITI-issued prepaid MasterCard account.
To address its lack of issuer support, Google is integrating TxVia, a payment processor it acquired earlier this year, that has connections to multiple payment networks. TxVia will offer Google a real-time, NFC-enabled cloud wallet, or a "digital proxy card" as one source called it, similar to a PayPal account except that it uses NFC to send and receive data at the point of sale.
"This allows Google to circumvent issuers who had been steering clear of Google Wallet as well as equip others who have been stymied by the work involved in enabling NFC payments," the source said.
Google is also expected to offer a solution with its ongoing battle with carriers over the Secure Element, or SE chip that encrypts and stores payment details inside NFC-enabled phones. The element is critical to Google Wallet making payments at the point of sale.
One source said the solution would avoid carriers by moving data into the cloud, similar to the PayPal model.