Gmail for web already has Google Wallet integration. Now Google has expanded this to Gmail for Android app. So, Gmail for Android users can now send or request money direct from the app by using Google Wallet.
It is important to note that the feature is not limited to your Google Contacts and the other person do not need to install the Google Wallet App. Anyone can receive or request money right from the email without installing any app. But you need to have Google Wallet account.
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The money will go to your bank account and this transaction will be free for both persons involved in the transaction.
To send money, tap on the paper clip icon and you will two new options: Send money and Request money. Tap on send, select amount, payment source and write the note. Now you can simply send as you send an email.
On the receiving end, you simply need to tap on claim money link and it will transfer money into your Google Wallet account. If you do not have Wallet account, you will need to go through the sign up process to claim the money.
The feature is limited to Android phones and only for people in U.S. There is no word when the feature will be available for iOS users or users living in other countries.