Google I/O: five things we care about: Android Pay

In the last of our five-part series about Google I/O, we’ll take a quick look at Android Pay, Google’s attempt at mobile payments. The company unveiled the Android Pay app, which replaces Google Wallet, in a bid to power tap-to-pay purchases on mobile devices at retail stores and within apps.

Google Wallet however isn’t quite dead, as it will be used for non-Android Play Store purchases on the web, and also for peer-to-peer payments…

Android Pay, a challenge to Apple Pay?

Google has been hard at work on mobile payments for a long time, and most Android smartphones have had near field communication (NFC) chips for years. Unfortunately, Google Wallet never quite lived up to its promise for one reason or another, plus the fact that Google faced major barriers trying to get banks and credit card companies to get onboard.

Those longstanding hurdles meant Apple launched its own service late last year and managed to capture all the press attention, with CEO Tim Cook saying that Apple Pay is now ahead of all its competitors.

Last year, Google snapped up some of the technology behind now-defunct Softcard. Back then, the company suggested that users should use Google Wallet instead, but the wireless carriers in the US at least will now just preinstall Android Pay on all new phones. And like Apple, Google also plans to allow reward programs to work with Android Pay. Thankfully this time, most of the major financial companies and banks seem to be onboard.

According to Google, around 70% of Android devices are now ready for Android Pay, with a respectable 700,000 merchants that can accept it in-store. Early signs from companies trialling the technology are that purchases with Android Pay are on average twice as large as normal credit card purchases…

Furthermore, capitalising on the new wave of Android phones that provide fingerprint sensors, users are able to simply touch their finger to pay with Android Pay. The Samsung Galaxy S6, one of the most popular flagship devices, already has such a fingerprint reader built in, and Google has added native support in the next version of Android – Android M.

Where does that leave Samsung, who is building its own rival mobile payments service? For those users, Samsung might not promote Android Pay in preference over its own system, even if it does become the pre-eminent payment technology on Android. iPhone users have it easy – there’s one payment system and all new iPhones come with Touch ID, but Android users will potentially have to deal with multiple offerings, and may or may not be able to use fingerprint authentication.

Whatever happens with Android Pay, it’s sure to benefit from riding the coat-tails of the already-established Apple Pay, which has gained a high profile through exposure in the media.

For consumers as a whole though, being able to leave the wallet at home (or at least a good portion of the credit cards we’d normally carry around) can only be a good thing.