Google creates a onetime virtual card number that it sends to the merchant and that the merchant can process. The onetime card number never changes for that transaction, so a chargeback and return can always be processed for that order. I'm sure Google plays a part in the chargeback process due to the fact it acquired TxVia in April.

http://support.google.com/wallet/bin/answer.py?hl=en&ans...

In regards to reward points- This article also mentions "Certain transactions may not earn your typical rewards or be eligible for certain benefits. Learn more about rewards. Please contact the seller with any questions about your order."

Most people seem to use their credit cards to pay for things instead of their debit cards to get reward points. This will definitely discourage people.