Originally Posted by
nabeelj
My understanding is it shows up as a payment from Google, but is coded with the correct merchant category (similar to how Paypal tags payment with the correct merchant category).
That's why Google Wallet tell you that you will receive category bonuses, but not merchant-specific bonuses, for your spending.
That'd be an interesting twist if Google plays the middle man (they pay the merchant, then charge the user). Theoretically, they could develop a system where you pre-set which cards you want to be charged based on the merchant category. Would not be the best system when it comes to minimum spends, but would be great otherwise.