AH Google Wallet Mobile Payments 1.0

Canada may allow merchants to refuse Google Wallet transactions

November 11, 2014 - Written By Melissa Bailey

Canada is set to give retailers an out for Google Wallet fees that don’t actually exist.  It appears that the Canadian government is considering a proposal regarding rejecting Google Wallet that could be announced as early as next week.  The proposal will allow retailers the ability to reject Google Wallet, which allows users to buy all kinds of things, including apps, books, music, movies, television shows and games.  Even if users are interested in paying for something in an online store, they’re likely to use Google Wallet.  Google Wallet is also next to get material design update and acts a repository for loyalty cards.  Generally, it is considered a widely usable Google product.

Despite the ability Google Wallet gives users, a conflict has arisen from the potential for an increase in transaction processing fees that merchants incur when they accept mobile payments.  Retailers are currently still allowed to pay the same transaction fee that is also associated with the fees of their physical debit or credit cards.  However, card companies could raise their fees in the future, when mobile payment processing becomes a more widely accepted and mainstream form of payment.

While Canada’s proposal can’t keep the credit card companies from increasing their fees, it will allow retailers to choose forms of payment they are willing to accept.  The Wall Street Journal released a quote from the drafted document, “Should fees set by the payment card networks in respect of contactless payments made from a mobile device increase relative to card-based contactless payments, payment card networks will develop the technical specifications to ensure that merchant acceptance of contactless payments made from a mobile device can be canceled at the point of sale without disabling other forms of contactless payments acceptance.”  Translated, it means that if fees are increased, merchants will be given the opportunity, through technical specifications, to cancel payments made from a mobile device at the point of sale without cancelling or disabling other contactless payments, such as PayPal.

It seems fair that merchants have the opportunity to choose how their payment processing is conducted, but we’re interested in knowing how it will affect the user.  If Google Wallet is such an easy to use, widely accepted form of payment processing, what will happen when users’ transactions are refused?  We’ll need to wait for the proposal to come to light and see how it affects both merchants and users.