The Payments Council has released a report that indicates a great deal of positivity around its new Paym mobile payments system.
According to the report, the payment technology, which is due to be tested later this year, will process around one billion payments by the end of 2018.
When the technology is launched 30 million current account holders in the UK will be able to make use of the service through their bank or building society, with that figure increasing to 40 million by the end of the year.
To make use of Paym, customers need to register their phone number and the account they want payments to be made to and from. The technology will then be integrated into customers’ existing mobile banking or payment apps as an additional way to pay, making it possible to send and receive payments using just a mobile number, without the need for sort codes or account numbers.
People without access to a smartphone can still accept payments into their registered account.
To send a payment, customers can simply log into their mobile application, using the passcode or security details they have set with their bank or building society, select a contact they would like to pay or enter their mobile phone manually.
The app will confirm the name of the recipient and then once the sender is happy, they can double check the amount and press send.
People sending payments through Paym will receive immediate confirmation that it has been sent.
The Payments Council's The Mobile Way To Pay report predicted that a significant number of payments will take place between friends and family initially, with 63 per cent of potential users surveyed saying they will utilise the technology to pay relatives and friends back for small items, such as cinema tickets or dinner.
Respondents also said they would use the new payment method to pay back work colleagues or for special occasions such as birthdays or Christmas.
Adrian Kamellard, chief executive of the Payments Council said: “As more and more services become available via mobile phones, it makes sense that there is plenty of demand to improve the way we can use them to pay.
“Paym will enable millions of people to pay securely using just a mobile number from spring this year. In a world where many of us are inseparable from our phones, it’s readily believable that more than 1 billion of these payments could be made in the next five years.”
Paym has been developed by the Payments Council organisation and the building societies and bank participating in the scheme. It meets with the latest security standards and regulations that are already applied to mobile and online banking.
The appetite to use Paym is set against a background of increasing use of and confidence in other types of online banking, as the report noted that 28 million consumers used online banking in 2012, which represented an increase of 9.4 million from the previous year.
The Payments Council will announce a launch date for Paym in April, with customers of Bank of Scotland, Barclays, Cumberland Building Society, Danske Bank, Halifax, HSBC, Lloyds Bank, Santander and TSB Bank able to use the service from later in spring.
In 2014, the Paym technology will be expanded even further, with Clydesdale Bank, first direct, Isle of Man Bank, NatWest, RBS International trading as NatWest, The Royal Bank of Scotland, and Yorkshire Bank committed to join, ensuring Paym will be available with around 90 per cent of current accounts in the UK.