Following news from Zvelo, a security firm, regarding a serious security issues with Google Wallet, Google’s mobile payment platform, Google has announced that it will be suspending the creation of new prepaid cards. The cards are linked to Google Wallet accounts and can be used to purchase goods from locations that are not capable of processing mobile transactions. Google is planning to address the issue and will resume issuing prepaid cards once the security problem has been resolved. The discovery of the flaw, however, may set Google’s plans for domination of the mobile commerce industry back significantly.
Google had touted the security of its mobile payment platform before its release last year. The company had initially claimed that its product was resilient against even the most tenacious hackers. Zvelo, however, showed that the company’s security measures could be trumped with the use of brute force technology. Google plans to resolve the problem, but the issue may quickly move outside their jurisdiction.
Google has partnered with several financial institutions to make mobile commerce possible through their Wallet platform. These banks may choose to take over the responsibility of security in order to protect the funds of consumers. As such, the platform’s security would be privy to the whims and regulations that govern these banks. Leaving Google with the responsibility would leave banks exposed to a great deal of risk as they will still be liable for financial disasters if Google were to fail a second time.