Mobile Payment – A Guide to Paying With Your Mobile Phone

With every passing year technology becomes a larger part of everyday life. With gadget and tech companies continuously inventing and innovating new ways for technology to aid us, it should come as no surprise that there are now plans for a system in which you can pay for goods without need of cash or cards. How I hear you ask? Well, through mobile payment of course.

The Mobile Payments Project

The project is being readied by The Payments Council which will in essence allow consumers to link their bank details with their mobile phone number thus allowing them to transfer money without the need for the recipient’s bank details – only their mobile number. It is important to remember that this technology is not about turning our smartphones into wallets as no money is electronically stored within the phone.

How It Differs From Current Mobile Methods

There are already ways of transferring money using your mobile of course; any internet enabled phone has the ability to access internet banking and many banks have even gone 1 step further and developed apps to simplify the process. The way that this new project will differ is that you will not need to know the recipients banks details – these will already have been linked with their mobile number. The idea of the project is merely to simplify the process of transferring money using your mobile phone – think of the technology as an improvement rather than an invention. The service will use the faster payments system so that money is transferred almost instantaneously between the accounts.

Barclays PingIt and Other Services

Currently, Barclays are the only UK bank to offer the service. Customers can register for the Barclays service – coined Barclays Pingit – by downloading the free Barclays Pingit App. The service allows users to send up to 750 per day and receive up to 5000 using only their mobile phones. A Smartphone is needed to send money however as long as your phone can receive SMS text messages, you can still receive money by registering for the service online. Pingit is also available to non-Barclays customers, but only as a method to receive payment, not send it. As the service becomes more widespread, it will be up to each bank as to how they will package it so to speak, but it is likely that the familiar app format will prevail.

There will be a standard minimum security set centrally to ensure that all payments are protected and details are secure. The app (if indeed the service should take the form of an app) will likely require a passcode/pin to enter and another to confirm the payment. Should anything go wrong, the user would be protected as with any other payment or transaction as long as they haven’t acted carelessly or dishonestly.

The service is expected to be free (as the Barclays one is) but as mentioned above, it is up to the banks individually to decide how to package the service and indeed what to charge.

Contactless Mobile Technology

The technology above is not to be confused with the contactless mobile payment also on the increase which makes use of NFC (near field communication) being incorporated into smartphones. Contactless Mobile Payment (referred to as CMP for the remained of the article) allows users to pay with mobile phone without the need for a physical care or cash; all that is required is that you hold your phone to the contactless reader within the store and your account will be debited for the amount.

Only customers of Barclays and Orange can currently make use of this technology (also only available on one model of phone) however it is expected that more banks will roll this out in the future. NatWest are holding a beta test of 1000 customers where CMP is made possible thanks to a chip being built into a special iPhone 4/4s case. CMP can currently only be used to pay for low value items (15 and under) and is based on the same Chip & Pin technology currently in use; for increased security only a small number of

CMP’s can be made before the consumer is prompted for a PIN at a terminal. If payments are made without consent of the cardholder, the same rights apply as they would to any other cardholder in regards to getting your money back.

Further Information

Further Information is readily available from around the web. If you have any questions regarding a specific bank it is advisable to contact them directly.