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An announcement by Citigroup and MasterCard Worldwide with Google of an NFC-based payment service is expected by the end of the week, sources told NFC Times.

As NFC Times reported May 19, plans call for Citi to issue a prepaid MasterCard PayPass application to be loaded onto Google’s Nexus S and perhaps other Android phones.

Google would provide the mobile wallet and is expected to offer other applications, such as mobile couponing. A report today said Google is planning to hold a “partner event” in New York City on Thursday. This happens to be Citi’s home base and is not far from MasterCard’s headquarters. The parties have declined to comment on the launch.

But contrary to an article May 24 by Bloomberg news service, Google is not planning to offer its own payment service. The article makes no mention of either Citi or MasterCard.

The article also reports that the new service, to be announced Thursday, will only be available on NFC phones from mobile operator Sprint. The telco recently started selling Google’s Nexus S 4G NFC phone, but this will not necessarily be the only model involved in the launch. The Nexus S 3G phone sold by T-Mobile USA might also be used, along with other phones yet to be introduced supporting NFC and Google’s Android mobile operating system.

As NFC Times reported last week, the initiative will put the Citi-issued PayPass application inside Google’s new mobile wallet, where it will be stored on the embedded secure chip in the Nexus S, sources said. Google is expected to have overall control of the secure chip, said the sources.

Google is also talking to other banks and service providers to offer applications for its wallet and plans pilots, sources have said.

The main part of the launch involving Citi and MasterCard is expected in the fourth quarter of 2011, although a smaller launch could happen earlier in the year, sources said.

Bloomberg in its recent article also repeated its earlier statements that Apple also plans its own NFC payment service, using NFC-enabled iPhones, citing consultant Richard Doherty. But Doherty has repudiated the statements attributed to him by in January by Bloomberg. which included his supposed assertion that the iPad, introduced in March, would also support NFC-based payment.  

The current iPad does not support NFC and the next iPhone is also unlikely to support it.