Erasing part of a texture

Probably most of you have seen "Where's my Water" in the AppStore. I am creating a game that has nothing to do with "Wheres my water" except for the digging part.

Basically I have a Texture I want to be able to erase with the finger revealing what's behind it , I have never used SetPixels/Apply but I read it is not a good idea from a performance standpoint. I would like to create that same effect Where's my Water creates for the terrain , where you can erase part of the texture with the best performance possible but I have no idea how to do that other than with SetPixels. I have read about Render Textures but I personally haven't understood the concept yet. What would you suggest in order to create something like this ?

Thanks in advance

 

I think you can use a shader for that. I'm thinking of a maintexture and a alpha texture. By using your finger you "paint" the alpha texture and thus make that part invisible in the maintexture.