Google Wallet card is predicted to fail as an m-payments stopgap.
Theresa is a Senior Analyst in the Consumer Payments team. Her specialisms center on emerging mobile payment technologie...
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Google appears to be rethinking its mobile payments strategy, with plans to release a Google Wallet card, designed to work as a complement to its existing offering under that brand. While strong evidence suggests that there is still a widespread consumer need for plastic cards in the US, Google’s move is unlikely to garner any real payoffs.
Near-field communication (NFC) adoption is likely to take time to develop in the US. As a result, Google and other providers face considerable challenges in convincing consumers and making mobile payments a success.
Since its launch, Google Wallet has faced setbacks: from low consumer usage rates and limited NFC infrastructure, to a lack of co-operation from large mobile network operators and banking institutions. The ongoing nature of such challenges reconfirms that there is still a strong consumer need for plastic cards.
According to several specialty news sites, Google is planning to tap into this space with a card that is managed online and linked to other accounts. This is not, however, an entirely new concept. PayPal currently has a plastic card offering for instore payments, and according to the company’s general manager of retail payments this card has struggled to take off.
While the Google Wallet card is functional without the need for an NFC-enabled phone, consumers will need to have the Google Wallet app and access to the Internet on their mobiles should they wish to switch card accounts before making purchases. Consumers are likely to find such a process tedious and are expected to stick to using the cards issued by their banks irrespective of the rewards and special offers Google may tie to Google Wallet accounts. It is unlikely that the Google Wallet card’s release will pay off given the process involved in using it.