BLOG: Is paying by mobile taking off?
Banking apps – which allow you to safely pay bills, transfer money and read account statements – have been downloaded more than 12 million times in recent years by customers of UK banks and building societies. And the evidence shows that the more familiar we become with them, the wider the range of tasks we use them for.
One such new way to manage money is Paym, the new way to pay by mobile which lets you pay back friends and family straight from your bank account to theirs using just their mobile number. Launched in April last year, it’s easy to use – you don’t need to use sort codes or account numbers and it tells you who you are paying before you pay – and has been developed to the highest security standards, with the project backed by 16 of the best known banks and building societies in the UK. This means you get the same security protection, passwords and other features that you are used to from your bank.
The early signs for the service are promising. Paym is available on more than nine out of ten current accounts and nearly two million people have already registered for the service, transferring a total of £26 million between them in just over six months.
Smartphones are an integral part of how we manage our social lives – and this chimes with how people are using Paym. Almost half of Paym payments are made between Friday and Sunday and almost a third of users have paid somebody back for lunch, dinner or a sandwich using Paym. And when it comes to who they’re paying, close friends top the list, followed by partners or spouse and parents.
Encouragingly, five out of six (85 per cent) people who have used Paym would recommend it and there are a number of reasons why, such as not having to carry cash around, not having to give account details out to others and the ease and convenience of using a mobile number rather than a bank account number and sort code.
This appetite for new ways to pay means innovation in mobile payments extends beyond sending money to friends and family. Contactless technology (sometimes known as NFC or ‘wave and pay’), which started on credit and debit cards (more than 54m contactless cards have been issued in the UK) is starting to be built in to more smartphones meaning you can tap your phone to pay for goods up to £20.
A growing number of companies like the mobile networks, big technology companies and card companies are starting to offer their own payment apps – often referred to as mobile wallets. For example Apple Pay could be launched in the UK in 2015. Typically, they store the details for your credit and debit cards, loyalty cards, receipts, vouchers, and other things you might keep in your wallet or purse on your mobile. You can then use them to do a number of things such as validate tickets, redeem vouchers, initiate transactions and use loyalty services.
The world of payments is changing at an increasing rate and with millions of consumers already using mobile banking, we’re no longer confined to cash, cheques, debit and credit cards to move money around. Our research has found potential for mobile money to grow even further, with two thirds of people aware of mobile payments. And with so much going on, now could be a great time to start if you are considering trying mobile payments for the first time.
To find out more about Paym, and how to register with your bank, visit paym.co.uk
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