Google Wallet to arrive in London in time for Olympics?

Google could launch its much-trumpeted Google Wallet mobile payments service in Britain ahead of the London 2012 Olympics, according to reports in the French press.

French newspaper Les Echoes reports that Google has been negotiating with British retailers, distributors and banks, to run pilot projects during the first quarter of 2012. This would allow the service to be fully operational in time for the Olympic Games in the summer.

Google Wallet uses near-field communications (NFC) technology, which allows consumers to carry out transactions using their mobile phones. NFC is a set of short-range wireless technologies that can beam and receive information at a distance of up to 4 inches, and is currently used in London Transport’s Oyster cards. Users tap their phones to a point-of-sale system to pay for goods.

Earlier this year, Google teamed up with US mobile operator Sprint and payment providers Citi, MasterCard and First Data, to carry out trials of Google Wallet in New York and San Francisco. The service launched in conjunction with Google Offers, the company’s local deals service, designed to compete with Groupon.

In the trial, user were able to sync their Google Wallet with their Offers in order to redeem coupons via NFC at participating SingleTap merchants, such as American Eagle, Macy’s and Subway, or by showing the bar code as users check out. the service is now available to all NFC-ready Nexus S 4G phone users in the US.

Launching Google Wallet in the UK ahead of the Games would potentially allow foreign visitors to pay for snacks and merchandise using their phones, helping retailers to overcome any currency issues and providing a backup when credit cards fail.

However, the Google could face competition. Earlier this year Samsung and Visa announced they were teaming up to produce a special mobile handset ahead of the games, equipped with NFC. The handsets will be distributed among Visa and Samsung sponsored athletes, and will also be available for consumers to purchase through mobile network operators and other distributors.

Meanwhile, Everything Everywhere announced in January that it would start offering mobile payments using NFC technology built into the phone’s SIM card; and O2 has also applied to the Financial Services Authority for a licence to hold money on behalf of its customers in a virtual “wallet”

Although NFC has been around for a while, there has recently been a resurgence of interest in the technology from within the mobile industry. A report by Juniper Research eralier this year predicted that global NFC mobile contactless payment transactions would reach nearly $50 billion (£31bn) worldwide by 2014, and that 2011 and 2012 would be “banner years” for NFC service rollouts.

A report last month by PayPal and Forrester also estimated that £2.5 billion will be spent using mobile phones in 2016.