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Google Wallet Links With Softcard To Upgrade Mobile Payment Platform

Google said Monday it plans to work with Softcard, a mobile payment carrier for three major wireless providers, to enhance its mobile payment platform, Google Wallet.

Google said Monday it plans to work with Softcard, a mobile payment carrier for three major wireless providers, to enhance its mobile payment platform, Google Wallet.

The development gives the company an edge in an already competitive mobile commerce market, pitting it against Apple's Apple Pay and Samsung's LoopPay, said partners.

"It's good for Google and good for the market as an industry," stressed Bob Delisa, president of Windsor, Conn.-based Google partner Cooperative Systems. "There were roadblocks for Google Wallet before with the carriers and this move helps that. It also opens up competition for the mobile payment space, and I'm a firm believer in competition."

[Related: Mobile Payment Head-To-Head: LoopPay Vs. Apple Pay]

The new partnership means that the Google Wallet app, which includes the tap and pay function, will come pre-installed on Android phones and can be used on any carrier network, according to Google. Google also confirmed it would acquire technology from Softcard to further improve Wallet.

Softcard, which uses NFC (near field communication) technology to transmit payment information, reaches more than 200 million wireless consumers through wireless carriers AT&T, T-Mobile and Verizon, according to the company's website.

Google Wallet, which includes a tap and pay feature and offers loyalty and gift cards, was first unveiled in 2011.

"[Since] we first introduced Google Wallet's tap and pay feature ... mobile payments have grown rapidly," said Ariel Bardin, vice president of payments, in a release. "Over the years, we've received great feedback from people who use this feature and we’ve continued investing to make it easy and secure for more people to pay with their phones. A big part of this is working with other innovators in the industry to help provide a seamless experience across a wide range of phones and stores."

Besides trying to expand Wallet's competitive edge in the mobile space, Google also is improving the platform's reputation. It was discovered by a security researcher in 2012 that Google Wallet contained a flaw enabling hackers to view the data contained on the user's digital wallet in the device, including credit card numbers. While the bug was later fixed, Google Wallet still has steps to take to ramp up its popularity.

Craig Hickman, vice president of sales at Bloomington, Ind.-based ProBleu, a Google partner, said he hopes the move will make NFC payments mainstream, since now both major operating systems iOS and Android provide the functionality by default.
"Some people will be very excited about this," he said. "For a long time now Google Wallet was only pre-installed on Nexus phones and downloadable for all phones. However, now all Android phones will have Google Wallet on it by default, so more people might give the technology a try… It will encourage the carriers to push back against companies like CVS who used to support Google Wallet until Apple Pay was released."

Google's partnership with Softcard and the wireless carriers comes a week after Samsung announced its plans to buy Burlington, Mass.-based LoopPay, a mobile payment platform touting Magnetic Secure Transmission technology, turning existing mag stripe readers into mobile contactless receivers.

LoopPay places pressure on one side of the mobile payment market, working on magnetic striped readers in most retail stores, unlike other platforms like Apple and Google Wallet. On the other side of the market, the government has embraced Apple Pay as a payment system for federal functions, like national parks, since its release in September.

Cooperative Systems' Delisa acknowledged the tough competition, but said that Google's partnership with carriers would give it a competitive boost.

"Apple is definitely in the lead in this area, but that competition is good and will bring the prices down," he said. "I don't think that contactless mobile payments will take over the payment space completely, but they will make a significant impact in the future and will also help Google Apps on the whole ... Google's trying to get more into the enterprise and play the entire field, and this is part of that."


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