Zapp mobile m-payments and m-commerce to be offered by five UK banks

15 January 2014

Zapp mobile m-payments and m-commerce to be offered by five UK banks

Five UK banks, comprising of Santander, Nationwide, Metro Bank, HSBC and its first direct online offshoot, are set to offer the Zapp mobile m-payment facility to their customers when it launches later this year. The Zapp app, which also offers mobile m-commerce, loyalty, online and in-store transactions and functionality, will be added to the UK banks’ various smartphone and tablet applications. VocaLink, the firm behind the Zapp app, is confident of adding more banks as the Q3 2014 rollout nears.

Zapp will enable the UK banks, which have a combined UK customer base of 18m account holders, to offer a convenient and simple way for their customers to pay for goods and services instantly in real-time using their existing bank accounts linked to their mobile device. The payments processor, VocaLink, believes this offers a secure m-payment and m-commerce transaction platform as user's bank details are not shared across supply chains.

The banks signing up to Zapp join WorldPay, Optimal Payments, Realex and SagePay, acquirers and payment processors that are already committed to rolling out the scheme to merchants and customers in order to try and ensure widespread UK adoption of the mobile m-payment and m-commerce ecosystem. The alliance will work together throughout 2014 to prepare for the rollout of Zapp payments to millions of customers, merchants and businesses. Together the group represents a third of all UK bank accounts, with 60% of UK merchants also presently covered.

Commenting on the latest sign-ups, Peter Keenan, chief executive officer (CEO) of Zapp, said: “I am truly excited to announce our lead financial institution partners: HSBC, first direct, Nationwide, Santander and Metro Bank. Together with our already announced acquirer partnerships, Zapp will go to market with real scale, offering simpler and more secure and efficient payments to millions of customers and businesses. I am delighted that these financial institutions (FIs) and acquirers have chosen to innovate to deliver value to their customers.”

David Yates, chairman of Zapp and CEO of VocaLink, added that Zapp is a major payment innovation for Britain which he believes will bring significant value to consumers, merchants and FIs and “proves that we are at the cutting edge of payment innovation, delivering significant value for the UK economy”.

Zapp is one of a several mobile payment systems competing for a share of the current mobile payment market, which research firm Gartner has previously estimated will be worth up to $721bn globally by 2017, as more individuals embrace using their smartphones to make purchases.

Banks Join Zapp: Santander, Nationwide, Metro Bank, HSBC / first direct
Rival UK banks such as Barclays with its Pingit app have already developed significant mobile payment and business offerings, but the en masse Zapp offering will significantly advance the UK m-payment and m-commerce marketplace. The five UK banks signing up today and rolling out the app will help to ensure large-scale uptake, and it means they do not have to work so hard on individual efforts.

Commenting on the partnership, Steve Pateman, head of UK banking at Santander, said: “Our customers want the choice to be able to pay on the go using mobile technology, and the Zapp proposition is second to none with its capabilities. Santander is as delighted to be involved with this initiative as we think our customers will be when they start using it. Zapp helps us meet the growing demand from customers to use their mobiles to pay for goods and services swiftly and securely. With the vast majority of UK merchants on board, we expect to see rapid take up of payments powered by Zapp.”

Brendan Cook, head of retail banking and wealth management at HSBC, commented: “Our customers' use of mobile banking is growing rapidly. Introducing Zapp to our mobile banking services will mean customers can benefit from convenient, fast and secure ways to pay using their mobile devices.”

For Tony Prestedge, chief operating officer (COO) at the Nationwide Building Society, the attraction is that Zapp puts customers in control of their finances, a key aim of the mutually-owned FI. “With Zapp, consumers can use their trusted banking app to directly pay for goods and services, and instantly check their balance as part of their process,” he said.

The commercial director of the newcomer UK Metro Bank, Paul Marriott-Clarke, which now has more than 20 branches across the country as it seeks to break into the retail banking market, said that he was also excited about the partnership: “Zapp is an exciting innovation that will provide something extra to those who want to bank through mobile devices, and we’re delighted to be involved.”

By Tony Aynsley and Neil Ainger

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