Google tipped to unveil NFC payment system on 26 May

Google is gearing up to unveil details of its near-field communication (NFC) mobile payment system tomorrow as the firm looks to enable Nexus S smartphone users to make purchases using the device.

The payment infrastructure is initially expected to be rolled out in New York and San Francisco with participating outlets including Macy's and Subway, according to reports.

The system is also expected to enable customers to redeem coupons and collect loyalty points, while developers will be able to create Android apps that use NFC, reports suggest.

Google made it clear during Mobile World Congress that it sees a big future for NFC, explained Howard Wilcox, senior analyst at Juniper Research.

"The most talked about aspect of NFC is the ability to carry out mobile payments, but the technology has much wider applications. Using NFC, users can be provided with a mobile wallet, and this is an area that Google is likely to explore," he told V3.co.uk.

"In the future NFC is expected to become integrated in smartphones like Bluetooth or camera functionality. In 2011, a lot of announcements are expected to be made, but it will take two to three years before user uptake accelerates."

The analyst added that he would not be surprised to see Apple adopting the technology, and that the incorporation of NFC into the iPhone would be a "game changer".

Wilcox previously predicted that NFC will be incorporated into one in five smartphones worldwide by 2014.

Google began trialling NFC payment technology in the US in March in partnership with Mastercard, Citigroup, VeriFone, a manufacturer of point-of-sale equipment, and ViVOtech, a provider of mobile-payment technology.

V3.co.uk contacted Google about the event on Thursday, but the firm declined to comment.

Orange and Barclaycard teamed up to launch the UK's first contactless payment service last Friday, allowing customers to pay for purchases using a smartphone.

Orange Quick Tap enables customers to make payments of up to £15 in over 50,000 outlets around the country, including Pret A Manger, McDonald's and Subway.