"This could replace your credit card," he says.

Schmidt and others contend that having your payment system on your phone is actually more secure than carrying it around on a piece of plastic, as it provides a greater level of authentication. And rather than imprinting your account number on a easily readable card, an NFC-enabled device keeps it encrypted and password-protected inside the phone.

"The credit card industry thinks that the loss rate is going to be much better. They're just fundamentally more secure," Schmidt says.