UK Banks Get Behind Mobile Payments

The UK’s Payments Council wants mobile payments to become mainstream in 2014. The organization has announced that eight banks in the country, representing 90% of UK current accounts, have committed to launching the first industry-wide mobile payment service in the spring of 2014.

The new service will enable secure payments to be made directly to or from an account without the need to disclose the sort code and account number, by simply using a mobile phone number as a proxy. While there are existing ways to pay using a mobile, the collaborative Payments Council project marks the first service with the potential to link up every bank account in the country with a mobile number.

Adrian Kamellard, Chief Executive of the Payments Council, said: “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. 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.”

The new mobile payments service will move money directly between accounts using tried and tested payment schemes: the Faster Payments service, which processed more than 800 million online and phone banking payments in 2012; and the LINK network, which processed 3.1 billion real-time ATM withdrawals last year.

Over 5,000 consumers participated in Payments Council research, which revealed that the service is likely to prove most popular with smartphone users, who accounted for two thirds (67%) of those surveyed. One in three smartphone users said they were either definitely or extremely likely to sign up to the new service at launch. The consumer research also highlighted the importance of the security of mobile payments. The Payments Council service will ensure that, as a minimum, a passcode or similar security feature will be required to authorise payments. The service will also offer the technical capacity for financial institutions to remotely disable an account in case of suspected misuse. Beyond these common features providers will be free to innovate and customise exactly how they offer the service to customers.