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Google closed its Wallet. It is temporarily disabling the provisioning of its prepaid Google Wallet cards used in some NFC-ready phones.

The move follows last week’s discovery of a vulnerability in Google Wallet. The Smartphone Champ released a second vulnerability for accessing Google Wallet prepaid card funds one day later.

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The step is a “precaution until we issue a permanent fix soon,” said Osama Bedier, vice president of Google Wallet and Payments.

The move should address “unauthorized use of an existing prepaid card balance if someone recovered a lost phone without a screen lock,” Bedier said.

Cyber Security

With Google Wallet, users load funds into the system using a credit card, and a user can apply those funds in contactless payments made using phones equipped with Near-Field Communications (NFC) technology. Google Wallet launched last September in a public beta on the Nexus S 4G smartphone from Sprint, with credit-card payments processed by MasterCard. At that time, Google gave users of Google Wallet $10 to load onto what it called the Google Prepaid Card.

Google has received no reports of any Google Wallet pre-paid card users losing funds because of the PIN vulnerability, a spokesman said. Google Wallet users can continue to use the Google pre-pay card as well as Citi-issued MasterCard credit cards with Google Wallet. Google is only disabling provisioning of new prepaid Google Wallet cards, the spokesman said.

Bedier said Google Wallet has protections by its own PIN, as well as the phone’s lock screen, but only if the user sets the lock screen. “But sometimes users choose to disable important security mechanisms in order to gain system-level root access to their phone; we strongly discourage doing so if you plan to use Google Wallet because the product is not supported on rooted phones.”

He said “rooting” a phone in most cases will cause Google Wallet data to automatically wipe from the device.

NFC hasn’t grown nearly as fast in the U.S. as it has in countries like South Korea, Japan and China, partly because surveys indicate Americans are not sure the technology is secure.

Another factor affecting the adoption of contactless payment technology in the United States is a shortage of phones supporting NFC. Most analysts expect the next iPhone will include an NFC chip tied to iTunes or an AppStore account. Apple’s entry into NFC could boost contactless payments.

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