Speaking at a VentureBeat conference in San Francisco, Google's vice president of commerce Stephanie Tilenius, forecast a rising tide of innovation in the mobile payments space.

"It's sort of like 1999 was with e-commerce, with eBay and Amazon. We're at the beginning of 10 years of innovation and competition," she said.

Tilenius was speaking the day after the search engine giant launched its Google Offers loyalty service in New York and San Francisco following a trial period in Portland. The Google loyalty programme is an intrinsic element in Google's strategy for mobile payments, with Android phone owners picking up daily deals and rewards programmes based on their location and preference.

Tilenius told the conference that one Portland bistro saw its lunch traffic double after using Google Offers to promote itself.

Google is betting that special offers aligned to single tap payments will provide the extra incentive that consumers need to ditch their plastic at the point-of-sale and switch to mobile. Yesterday, the company announced a reputed $10 million acquisition of loyalty card start-up Punchd. The one-year old firm, which has just six staff, has developed a smart phone app that works as a digital punch card, offering discounts and special offers for repeat visits to signed-up merchants.

Google is also working on plans to embed its loyalty and payments business deeper into the social fabric by integrating the products into its newly-launched Google+ social circles network, Tilenius told the VentureBeat conference, as well as other properties such as Google Maps.