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Google Wallet strains retailers

Alex Kayle
By Alex Kayle, Senior portals journalist
Johannesburg, 16 Aug 2011

Google Wallet strains retailers

Internet giant Google's foray into the world of mobile payments could be the catalyst that sees retailers upgrade their electronic point-of-sale terminals, reports Retail Gazette.

Google Wallet allows customers to buy goods in store via their smartphones by simply tapping their handset on a reader.

Google Wallet is set to be available worldwide at the end of this month but Scott Storey, MD of technology solutions firm CTS Retail, argues that many firms are currently not capable of accepting payments made this way.

Storey says: “The introduction of Google Wallet will mean that many retailers will have to seriously look at their provision. In the same way that we have moved from the audio cassette to CDs, to digital download with music, I can see the migration of payment methods from cash to cheque, to debit /credit cards and now the latest technology - mobile phones with applications such as Google Wallet.”

However, The Tennessean says the old-fashioned wallet won't become extinct anytime soon. Near field communications (NFC) will soon enable cellphones to step into the role of a credit or debit card, becoming the actual payment tool in bricks-and-mortar stores.

“Payments change very slowly,” says IDC analyst Aaron McPherson. “We're seeing a real blossoming of creativity and all these different payment technologies, but it's way too early to make any kind of prediction about which one will win out.”

Zippy Cart states there are many other companies throwing their own options into the ring, such as American Express' Serve (which has been picked up by Verizon) and PayPal's NFC-based mobile payments system.

According to CTS Retail, the limiting factor will be how quickly businesses can adjust to this new technology. Unlike e-commerce solutions, which are set up from the start to take electronic payments, many retail point of sale systems are not. According to CTS, these retail outlets usually update their systems about every seven years.

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