Paying by mobile phone: A guide to the new Paym system
A new system is set to transform the way we send payments to friends and family.
Online payments, chip and pin and contactless cards have all transformed the consumer shopping experience.
And from today (29 April), a new system is set to shake up the way we pay for everyday goods or send money to family and friends.
Paym [pronounced “Pay Em”], launched by the Payments Council, will link up every current account in the country with a mobile number.
This means you will be able to move funds directly from account to account, without the need for a sort code or account number.
By the end of 2014, Paym is expected to be available on more than nine out of ten UK current accounts.
Here’s what you need to know:
How does it work?
You first need to register your mobile number and the current account you want payments made into with your participating bank or building society.
Paym will be integrated into your existing mobile banking or payment apps, so you can get the app link texted to your phone from the bank or building society’s website and then register for Paym via the app.
The person you are sending funds to will also have to be registered.
After you have registered, to pay a friend, a family member or even a local trader you would use your existing mobile banking or payments app to select their number from your contacts or enter the mobile number manually.
As part of the process you’ll be asked to confirm the name of the recipient – so you can be sure you’re paying the right person before you press send. Once you’re happy, check the amount and press send.
You’ll receive confirmation that your payment has been sent. And because you’ll be using your existing mobile banking or payments app, most payments are processed almost immediately.
All providers will let their customers send at least £250 per day, although this can be a bit more in some instances.
Which providers offer Paym?
You will be able to use Paym to send and receive secure payments between current accounts at Bank of Scotland, Barclays, Cumberland Building Society, Danske Bank, Halifax, HSBC, Lloyds Bank, Santander and TSB.
The following banks and building societies will join Paym later in the year: Clydesdale Bank, first direct, Isle of Man Bank, NatWest, RBS International trading as NatWest, The Royal Bank of Scotland, and Yorkshire Bank.
This will mean that Paym will be available on more than nine out of ten current accounts.
Nationwide Building Society has also confirmed its intention to join in early 2015, while Metro Bank and Ulster Bank are finalising their plans to join.
Is it secure?
Money is transferred using the same systems already used to transfer account funds, Faster Payments and LINK.
The service has security measures such as password activation, mobile number verification and confirmation requests as standard, and participating banks and building societies have all signed up to a security code of conduct to protect the service from fraudulent activity.