Left pocket: phone. Right pocket: keys and change. Back pocket: wallet stuffed with membership cards, business cards, and twenty coffee loyalty cards sporting one stamp each. But one of those pockets may soon be freed up, with Google announcing Google Wallet, an app that allows payment, loyalty card, and special offers to be processed using only a smartphone.

The announcement was made via Google’s blog, and at the moment Google Wallet is only available on one phone model on one carrier in the US, but partnerships with CitiBank and MasterCard give it global potential.

The technology, first shown off in May, uses near field communication (NFC) technology. It will work in a similar way to the recently-introduced MasterCard PayPass and Visa payWave systems, and Google claims its system will work with the existing counter-top equipment used for those two services.

Ovum analyst Eden Zoller says this latest offering rounds out Google’s line-up of services. Wallet joins Google+, a Facebook-style social network that opened to the public just this week, Google Offers, a group buying deals service, as well as Google’s undisputed title as master of search. “If Google is smart then Google Wallet could be about a lot more than just mobile payments and incorporate loyalty schemes, check-ins, and advertising, among other things,” Zoller says.

With unconfirmed reports that Apple is also working on NFC technology for retail payments, yet another battlefield has been created in the ongoing war between the two tech giants.

In other NFC news, JCDecaux announced earlier this week it has signed an exclusive agreement to enhance its outdoor advertising network with the technology, in partnership with new technology company, Tapit. The NFC-enabled network will allow advertisers to create campaigns that consumers can interact with using smartphones, with suggestions ranging from localised coupon offers to treasure hunts.