Until today, that NFC chip on your Sprint Nexus S 4G hasn't been living up to its potential. Today, though, today Google and Sprint have given it life -- and with it, certain death to many a MasterCard balance. Google Wallet is Android's long-awaited mobile payment app, which allows you to morph a smartphone into a full-fledged spending machine.
Before we start: If you're not sure what NFC is, might we recommend a read of our NFC primer? It'll tell you everything you need to know about near-field communication.
Now, a quick history lesson: In 2003, MasterCard introduced PayPass, a system in which a credit card outfitted with a near-field communication (NFC) chip could be passed within a couple inches of a reader to pay without swiping. Google Wallet, however, takes the card entirely out of the equation and turns your handset into an agent for credit cards or cold, hard cash.
Shoppers can authorize the app to charge a preexisting Citi MasterCard card or deduct money from a prepaid debit card (you can add funds from your bank account or a non-Citi-card, though that's kind of an awkward workaround at the moment). Google just announced today that Wallet will also soon support Discover, Visa, and American Express accounts. On our tester handset, I was able to quickly add my MasterCard by inputting some simple identifying info -- birthday, zip code, stuff like that -- for an instant cellular $100 line of credit. You can authorize the handset to have access to your entire available balance, but I chose to at least try to keep things in check.
Right now, you're able to set one payment card as your default, but as the app matures and store cash registers get their own software upgrades, users will be able to create store-specific profiles. So, if you have a Macy's gift card, the app will know to use that automatically when sending payment information to a Macy's register.
Eventually, upgraded registers at participating stores, including Macy's, Subway, and Walgreens, will allow customers to redeem electronic coupons, "swipe" store loyalty and gift cards, and save electronic receipts on their handsets at the end of a transaction. RIght now you can only add store-branded cards for American Eagle Outfitters (cargo shorts shopping spree!), but more are promised in the future.
But what about security? The Nexus S 4G hardware protects your virtual cash with two layers of security. The NFC chip, which is built into the rear battery door, works only when the screen is on, which means a passerby can't steal payment info when your phone is sitting idle in your pocket. A second secure chip stores all your authorized credit-card information. You must be logged into Wallet with a unique PIN to allow any seller access to the data on the secure chip, a process that times out at an interval you set, forcing you to re-enter your information every 20 minutes or so.
In order to get Wallet of the ground, Google had to create a secure payment network and follow a distinct path for each transaction. At checkout, the phone's NFC chip initiates a connection with a receiver—in this case, a cash register—by way of a four-inch-wide magnetic current. The cash register transmits the total amount due to a secure payment chip inside your phone. That chip sends a request to the bank through the phone's antenna, and the bank then authorizes the transaction through the register. The entire process takes only a few seconds.
We tried out Google Wallet at a self-checkout at a bodega around the corner from the PopSci HQ, buying ourselves some high-class Fiji water (it tastes better because the bottle is square) with the $10 Google gift card Google gave us to experiment with. It worked perfectly, happy to say: just as easy as using one of the NFC-enabled credit cards. We had our Google gift card enabled as the default, so all we had to do was take the phone out of our pocket, turn on the screen (to activate the NFC chip), and tap it to the point-of-service kiosk. Bam. Expensive water, purchased. It's good to see how easy it is to use--now we're just waiting for it to spread to more phones, more credit cards, more stores.
If you have a Sprint Nexus S 4G, you can check out Wallet right now.
With all the malware out on the Android Market, I wouldn't be surprised if someone developed something to side-step the NFC security. For example, a fake PIN screen to steal your NFC pin number and one that disables the whole "works only when the screen is on" feature. With some malware not rooting your device without your knowledge who knows what's possible - I'm going to hold off on this until it's thoroughly field tested by others. I'm still required to carry around ID and so credit cards will simply tag along for now.
While it seems cool to have all of your credit cards in one place -- remember this -- All of your credit info is accessible from one place!
(maybe it's not yet, but that's the agenda)
Right now, I can leave cards at home, or physically separate them, to maintain some security. With this system, if somebody gets your phone, they could probably do severe damage before you could notify your creditors.
At least they may have addressed one issue. The last nfc stuff that I read described the whole transaction as taking place through the nfc interface. I believe that this could be tapped. In this iteration, it seems that there will be some cell comm as well, which is good.
I still don't want one.
I'll wait a few years and see how this pans out. New technology is great, but those viruses and hackers are so expert in their evil deeds.
yeah never not ever. Your going to see this exploited days after its implemented. Thank you but i like to keep my money.
While the technology is innovative and has quite the 'cool factor' I agree with the commonsensical people here... not for me, as I do not trust the security of such devices/cards/chips/etc. Greenbacks remain in my wallet, with 1 or 2 credit cards for stuff that I need but may not have sufficient cash to get on the spot.
I'm curious (rhetorically speaking) just how far off we are from being so dependent on technology that we'll be unable to function when it all goes kerblooey...?
Can't wait for mine!
I already do all of my interactions with my debit card anyway. I hate change.
The idea that finally all of my receipts will be stored and available electronically instead of casually discarded will be a great help when traveling for my company.
Be prepared for the final demise of paper money, just like the end of the post office.
No, it won't happen any time soon, but eventually convenience and good old fashioned "What, me wait?" American mentality will prevail.
Almost everyone has a credit card in their wallet with a NFC already, if anything, this should be more secure.
I'm surprised that Google decided to partner with Sprint to unveil this technology though, you would think Google would use one of the much larger bases of AT&T or Verizon.
Oh well, I guess I'll just have to be patient and wait like 78% of all wireless users.
This honestly scares me, because as these technologies get more and more advanced, they are getting better and better at breaking into them. I won't be the person to say BANKING ONLINE IS ASKING TO GET YOUR INFORMATION STOLEN, but I will say that the very essence of money is changing. Money used to be a paper that you could actually turn in and get silver, and possibly (I have to brush up on my money studies) gold equal to the amount on the bill. THAT is why money worked, because it HAD value. Now that we are off the silver standard, money is just paper that the government prints.. Not to be the naysayer, but if something major such as a nuclear war does happen, what good is all of this going to be? I think we are setting ourselves on a peak that is very VERY nice whilst we are on it, but has literally no value..
Another thing I've always wondered, if someone knows please let me know so I can look into it more, is there physical money to back up all the "money" out there with credit card dept and loans and such? I don't honestly think that there is enough money to back up all the dept we have, which means eventually that is going to catch up, if it isn't already.
from this the beast(666) Will emerge. this combined with the microchip implant will have us controlled.
The people of the world only divide into two kinds, One sort with brains who hold no religion, The other with religion and no brain.
- Abu-al-Ala al-Marri
The main thing I don't like about electronic payments is how they collect information about you to try to sell you things later on. A company as an entity simply wants my money in order to sustain itself. I saw a documentary once that compared corporations to sociopaths. The whole thing just makes me uncomfortable.
I'm not worried about identity theft. All these things are just numbers in a computer. A widely accepted social construct. Someone stealing your numbers doesn't change who you are.
But, being considered a number within an equation that is ultimately defined as "me" really clashes with what I actually am.