Google tightens its grip on smartphone wallets

Google has assured users of its smartphone wallets that the mobile-age technology thwarts thieves better than old-school cash or credit cards. "Mobile payments are going to become more common in the coming years, and we will learn much more as we continue to develop Google Wallet," Google payments vice president Osama Bedier said in a blog post. "In the meantime, you can be confident that the digital wallet you carry provides defences that plastic and leather simply don't." A Google Wallet feature that lets people load prepaid card information in smartphones for spending was re-activated this week after being shut off for a few days to fix a potential security vulnerability. "While we're not aware of any abuse of prepaid cards or the Wallet PIN resulting from these recent reports, we took this step as a precaution to ensure the security of our Wallet customers," Bedier said. The action from Google came after a Zvelo Labs researcher demonstrated software that quickly figures out a Wallet personal identification number (PIN), provided the crook has the smartphone. The researcher dismissed the threat of hackers picking Google Wallets remotely, explaining that physical access is needed to get priority access to controls in a process called "rooting." Security specialists advise Google Wallet to enable security features such as full-disk encryption and screen locks. Google Wallet is available only on Nexus S and Galaxy Nexus smartphones. Google plans to expand the feature to more Android phones. Google Wallet uses a near field communication chip embedded in a phone to allow a user to "tap-and-pay" for purchases at a checkout register equipped with the PayPass system from CitiMasterCard. Customers can also use a Google Prepaid card to pay for purchases, topping up the Google card with any payment card, and take advantage of Google Offers, the Mountain View, California-based company's online discount coupon program. In addition to allowing for mobile payments, Google Wallet allows consumers to pay using gift cards and to redeem promotions such as discounts or coupons.