Google unveils ‘tap-and-pay’ smartphone – but what’s wrong with cards?

Google unveiled a new mobile phone embedded with a chip that transforms it into a virtual wallet enables consumers to “tap and pay.” 

“You will be able to take these mobile devices that will be able to do commerce,” Google CEO Eric Schmidt said at San Fran’s Web 2.0 conference. “Essentially, bump for everything and eventually replace credit cards. In the industry it is referred to as tap-and-pay.”

The near-field chips store personal data that, by tapping a handset on a pad, can execute a financial transaction.

Eric did not reveal which company made the mobile phone.

Secure chips in handsets thwart fraud better than credit cards, Eric contends, but I don’t see the problem with credit cards. What I see a problem with is constantly changing payment technology. 

At one point, all credit card payments were the same: swipe, then sign a receipt. But credit card companies introduced chip technology, so everybody can punch in 4-digit PINs instead of signing. Then there’s also credit cards that can tap-and-pay. None of this is convenient, contrary to what you’re told – it’s a nuisance. Because now, any given retailer will have a tap reader, a chip reader (of which vary tremendously), or still use receipts.

While even newer technology is introduced – such as smartphone-credit-card fusions – many consumers don’t even have chips in their credit cards yet, and won’t until 2011.

I understand that these new technologies are supposed to equate to convenience, but the most convenient payment model is one that is universal. When there is a mulitude of overlapping payment options, nobody wins. I say, let’s get back to the basics until everyone is on the same page – or smartphone.