Even though Apple was not the first handset maker to come out with a wireless payments product for mobile devices, the company’s Apple Pay service — available only on the iPhone 6 and iPhone 6 Plus at the moment — became widely used in the U.S. surpassing existing NFC payment products that were already available on other platforms, including Android. Ars Technica has learned that Google is ready to respond to Apple Pay with a new product of its own that will apparently not replace Google Wallet, a service that’s hasn’t really taken off.
According to a source familiar with the matter, Google will be announcing a new payments API at Google I/O in May, which it’ll aptly going to call Android Pay. Just like Apple Pay, Android Pay should be used for both in-store payments, but also virtual goods purchased inside Android applications.
Apparently, Google will build Android Pay from the ground up for Android developers, and will use Google’s Host Card Emulation (HCE) feature that lets third-party apps use Android NFC chips for payments purposes.
Google Wallet will not just succumb, as the service will continue to coexist with Android Pay, allowing users to link the two products. But customers could only use Android Pay without setting up a Wallet account. One other differences between them is that Android Pay’s APIs will let any merchant add a wireless payment option inside their apps to enable single-tap transactions, but also in their physical stores.
Furthermore, Android Pay might not cost Google any fees per transaction, as Google Wallet does. With Google Wallet, users upload their card information and then use a virtual prepaid Google card for purchases, whereas in Android Pay they’d simply be able to add their actual credit cards and debit cards to the app for mobile payments.
Android Pay is yet to be confirmed, but Google is definitely determined to improve its mobile payments offers. Only a few days ago, the search giant confirmed it purchased SoftCard, a Google Wallet competitor created by top U.S. carriers, which was formerly called Isis.