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Banking app given go-ahead

Banking app given go-ahead

Category: Banking

Updated: 16/01/2014
First Published: 16/01/2014

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

A smartphone app that allows shoppers to pay for goods via a direct link with their current account has been given the go-ahead by some of the UK's largest banks, signalling that the banking arena is gearing up for increased reliance on mobile payment systems.

The app, known as Zapp, is due to be launched later this year and will be available to some 18 million customers who hold accounts with Nationwide, HSBC, first direct, Santander and Metro Bank.

The app will initially only be suitable for online purchases, however Vocalink, the app's developers and group that runs the payment infrastructure of the UK, is working on making the app enabled for in-store purchases by late 2015.

In essence, the app will reduce the need for credit and debit cards on the high street as well as online, and is touted as being a much more secure way to pay as there's no need to share credit card details with the retailer.

Zapp isn't the only mobile payment system on the market – similar "digital wallets" are offered by providers including Visa and PayPal, while Barclays, who isn't signed up with Zapp, has got its own mobile payments service called Pingit – but for many it offers a great opportunity.

The cooperative nature of the app means standalone products could quickly lose their competitive edge, and many banks see it as a great way to become a credible current account provider and rebuild customer relationships – with account switching being easier than ever before banks need to do more to keep their customers, and offering this kind of service could add to their appeal.

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Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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