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New mobile payment service gets launch date

New mobile payment service gets launch date

Category: Banking

Updated: 03/04/2014
First Published: 03/04/2014

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 It is now over 6 months old so the content may be out of date.

Mobile banking is rapidly growing in popularity, with a lot of consumers choosing to conduct their day-to-day banking through the wonders of smartphone apps. The concept of paying via mobile phone number has already been utilised by a number of major institutions too, including Barclays and RBS, but now there's set to be a wide-ranging system that will allow customers of several different banks to make payments to each other – Paym.

The Paym service (pronounced "Pay Em") will be officially launched on 29 April, it was announced yesterday, and customers are now able to register for the service to get ready for its launch date. The new system means that anyone wanting to make a payment to a friend or family member no longer needs to ask for bank account details – so long as both parties are signed up to the service, they can make the payment quickly and simply using the payee's phone number.

Security won't be an issue either as the new service will be integrated into the individual's current mobile banking app, so it's fully password protected and payments won't be possible unless a passcode is entered.

Customers of participating banks and building societies (so far these include Bank of Scotland, Barclays, Cumberland Building Society, Halifax, HSBC, Lloyds, Santander and TSB) will be able to register for the service by linking their mobile number with their bank account, and after the service is live they'll be able to receive money to that account (or can send payments from it) through Paym.

Other banks are set to join the service in the not-too-distant future, including first direct, NatWest, RBS, Yorkshire Bank, Nationwide Building Society and Metro Bank, arguably making it the most wide-ranging service of its kind.

It could prove to be a great way to make those small payments or pay friends back for that lunch when you forgot your wallet – particularly with research from the Payments Council, the organisation behind Paym, finding that UK consumers tot up around £255 per year in informal loans and IOUs.

"Our IOU research suggests that every adult in the UKis lending just under £5 per week to someone they know. Small sums like this soon add up so it's great that Paym will give people a new option of quickly and securely paying someone back," said Adrian Kamellard of the Payments Council.

It's a great move for the industry, particularly with consumer demand for mobile banking services only ever being on the rise. People want the flexibility of being able to effectively manage their finances whenever and wherever it suits them, and Paym will only add to the convenience.

However, this rise in mobile banking could perhaps account for the large number of high street branches being closed down too, something which perhaps isn't so readily welcomed.

RBS is the latest bank to announce branch closures, with the news that 44 of its branches will be shutting – including 14 that are the "last banks in town" – being met with criticism by many. The bank's justification is that there's been a 30% drop in the number of branch transactions since 2010 and those last banks in town are only open for a few hours a week, and have plans to invest in mobile, telephone and online banking instead.

The high street might be changing but it's clear people are still clamouring for the ease of mobile banking, and at least the new Paym service will offer even more convenience for those customers seeking a quick and simple way to pay.

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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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