Shared UK m-payments service gets bank backing ahead of delayed 2014 start

16 January 2013

The UK is waiting for the introduction of a common, shared industry-wide peer-to-peer and person-to-business mobile payments service early next year, with eight major banks, including Lloyds and RBS, now signed on for the service, but a further delay until spring 2014 is now envisaged as the price for getting all the banks on board for the common service.

The Payments Council, which is the body that contracted VocaLink to build the central database which will allow UK banks to administer a service that links customer phone numbers to bank accounts in order to facilitate instant mobile payments, insists the service is still on track, depite the original plans for a service this year slipping over into next year.

Seprately, the UK Payments Council also released a poll that it says shows strong customer support in the UK for the planned new m-payment service. The industry body questioned 5,238 people in November last year and after crunching the numbers it says it found that of the 67% of respondents who had a smartphone, one third of them said they would ‘definitely’ sign-up to the new service starting in Q1 2014.

The UK retail banking industry, which is keen to support the expansion of mobile P2P payments and mobile banking generally to increase customer service and allay fears about disintermediation, is also taking heart from the good uptake numbers of Barclays Pingit app which was downloaded more than half a million times in its first quarter and already allows its customers to make m-payments, after the bank controversially jumped the gun on its rivals. Barclays decision to launch its Pingit app, and not wait for others to catch up looks increasingly justified with the announcement of further delays until spring 2014.

The new shared m-payment service will mean payments can be made directly to or from a UK account without needing the bank sort code or account number; a mobile phone number will suffice and volume will be guaranteed by industry cooperation.

Barclays will use the new shared service, alongside all the vast majority of other UK banks, when they move en masse to the service, along with HSBC, Cumberland Building Society, Danske Bank, Metro Bank and Santander.

“The mobile payments project is a fantastic example of the unique role the Payments Council can play in delivering far-reaching, innovative improvements for customers,” said Adrian Kamellard, chief executive of the Council. “This new service will offer a simple, secure way to split a bill for dinner, receive money from a friend or pay a tradesman without needing to remember or share account details."

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