Google is reportedly planning to test a mobile payment system based on NFC (near field communication) technology in shops in New York and San Francisco within the next four months.
People familiar with Google's plans have told Bloomberg that Google will be installing thousands of NFC enabled cash register systems at partner locations. The new technology would work like the Oyster card system used on London Transport, except cutomers would place a mobile device on the reader instead.
The special cash registers have been built by VeriFone Systems and have been designed to accept mobile payments from mobile phones that are equipped with NFC chips. Google is hoping to a get a head start in the mobile payment market by bringing its own payment services to the market before any one else.
Google's service will compete with an upcoming mobile payment system being developed in a partnership between Ebay's PayPal and ISIS. The system is backed by wireless carriers AT&T and Verizon Wireless with the payments being handled by Discover Financial Services. The service will be trialled this year.
Google's NFC service, or any other mobile payments service for that matter, will be counting on mobile phone and smartphone makers to include NFC technology on their devices.
Samsung's new Nexus S smartphone is one of the few devices that comes with this technology but Nokia and Research in Motion have both confirmed that they will launching NFC enabled devices soon.