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Google presents tap-to-pay cellphone wallet payment system

Google is about to launch a payment service via mobile phones with the Android operating system, various media reported today, including the Wall Street Journal.

The idea is that customers only have to hold their phone against a device at the checkout (tap-to-pay). Apparently the company will unveil the service on Thursday. At first the system will be available in only five U.S. cities in the network of the third-largest phone company in the country, Sprint Nextel, and only on the Nexus S phone.

Google will use NFC technology (Near Field Communication), with which devices can communicate with each other at short distances. Already used for example on entry cards and increasingly with credit cards.

Some few years ago Nokia planned to place NFC chips on a large-scale in their phones, but the idea was not successful. Now this technology returns to manage a payment system for cellphones.

It has long been assumed that cell phones will become mobile wallets, so now companies from various sectors are competing for the market: banks, telephone companies, online payment systems, Google and allegedly also its arch-rival Apple.

While the iPhone maker keeps its plans secret, Google clearly showed its intentions by placing an NFC chip on its flagship Nexus S. Considering that the Android operating system currently owns the highest market share in the smartphone market, is is sure to have strong influence on the future of this technology.