Google announced its new near-field communications (NFC) mobile payment system, "Google Wallet," this afternoon in New York. 

NFC technology is a short-range wireless technology that allows mobile users to pay for everyday purchases at a register using their cell phones. This new technology, which eliminates the need for cash or credit cards, works by tapping the mobile device at a register. An NFC-enabled mobile device has a NFC chip that contains the users financial account information, and when the user taps the device, the chip interacts with the register and allows for payment.

Back in March of this year, Google decided to hop on the NFC mobile payment bandwagon as well. It announced that it was testing a mobile payment service in San Francisco and New York stores using special cash register systems designed by VeriFone Systems Inc. Google estimated that its mobile payments service would take about four months to complete.  

But only a little over two months later, Google has announced its NFC mobile payments service, "Google Wallet," and gave a demonstration of the new app today. 

Google has partnered with Sprint, Citi, MasterCard and First Data to introduce its new mobile wallet. The system will support Citi MasterCard and a Google Prepaid Card at first, which can be funded by most payment cards, and from there on out, users can use their mobile device to pay for purchases wherever MasterCard PayPass is accepted. 

Google Wallet allows users to store credit cards, loyalty cards, gift cards and offers. When the device is used to make a purchase, the app automatically redeems offers and earns loyalty points for the user. Google Wallet will also sync a user’s Google Offers, which can be redeemed at participating SingleTap merchants via NFC or by presenting a barcode at checkout. 

"Google Wallet is a key part of our ongoing effort to improve shopping for both businesses and consumers," said The Official Google Blog. "It's aimed at making it easier for you to pay for and save on the goods you want, while giving merchants more ways to offer coupons and loyalty programs to customers, as well as bridging the gap between online and offline commerce."

Google Wallet will initially be compatible only with Sprint's Nexus S 4G by Google. But Google plans to apply compatibility to other phones in the future. 

Google Wallet is still undergoing field testing at the moment, but will be released soon, according to The Official Google Blog.

Many tech companies have incorporated NFC technology into their mobile devices, and are now negotiating deals with credit card companies to allow users to utilize the new technology to its maximum potential. For instance, Verizon Wireless, AT&T Inc. and T-Mobile USA joined forces with Discover Financial Services' national payment network to form Isis. Isis is also looking to embrace other credit card giants like Visa and MasterCard.