Google Wallet will work at fewer than 1 in 100 MasterCard locations

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Google Wallet, which was announced Thursday, may be the first major initiative to get smartphones to serve as all-in-one payment devices.

But like the first boat, airplane and light bulb, it may be awhile before most people see it in action.

MasterCard, a partner with Google on the new system, announced that Google Wallet could be used at more than 311,000 merchant locations around the world. That sounds like a lot, until you consider that MasterCard-branded credit and debit cards are accepted at 31.7 million locations globally. (See Page 13 of MasterCard’s 2010 annual report for more details.)

That means fewer than one in 100 MasterCard retail locations now allow mobile payments. And that’s only if you have the right smartphone -- in this case, the Sprint Nexus S 4G. In general, those will be merchants that can already accept MasterCard ‘PayPass’ -- the contactless credit cards that consumers can wave rather than swipe. Most older credit card readers don’t do that yet.

This is not to say that the technology won’t catch on quickly. In all liklihood, the convenience of leaving your plastic cards at home will win many converts among consumers and merchants. But technology companies have a tendency to announce products well before they’re widely available, both to build buzz and to stay ahead of their competitors in the PR game.

Google has stressed that Google Wallet won’t be ready for months and is being extensively field-tested in New York and San Francisco before it rolls out on a wider basis. The question is, how many merchants will be ready for them?

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-- David Sarno