Paym mobile payments service launches
Millions can now use just a mobile number to send and receive payments and settle up those IOUs.
A major new payments service called Paym has been launched today (29th April).
Pronounced ‘pay em’, it enables you to send and receive payments directly to a current account using just a mobile number.
This latest development in the payments revolution eliminates the need for a sort code and current account number to move money between people's accounts.
So paying a friend back for a gig ticket or getting back that fiver you lent your brother won’t involve the hassle of giving out your account details or collecting someone else’s.
Now you'll just need a mobile number to settle up those IOUs.
Earn up to 5% interest from a current account
Who can use Paym?
Current account holders at nine major banks and building society brands will be able to use the service from today. They are: Bank of Scotland, Barclays, Cumberland Building Society, Danske Bank, Halifax, HSBC, Lloyds Bank, Santander and TSB.
This means more than 30 million people across the UK can now use Paym to send and receive payments using just a mobile number.
Later in 2014 Clydesdale Bank, first direct, Isle of Man Bank, NatWest, Royal Bank of Scotland, Ulster Bank and Yorkshire Bank will offer the service. Nationwide will join in early 2015.
So eventually nine out of ten current accounts, held by 40 million people, could be set up for simpler account-to-account payments.
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How to use Paym
To receive money using Paym you need to link your mobile number with the current account (from a participating bank or building society) you’d like any payments made into.
To send money using Paym you need to use your existing mobile banking or payments app to select a number from your contacts, or enter the number manually.
When sending payments your own number doesn’t have to be linked up to a current account but the receiver’s does. Also, while you don’t need to use a smartphone to receive payments, those sending payments do.
The Payments Council, which is driving the Paym service, says you’ll be able to transfer up to £250 a day between accounts, though some banks and building societies will offer a higher daily limit.
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Security concerns
Paym sounds simple enough, but there are concerns about the safety of this new service.
Consumer Intelligence research found that nearly half (47%) of 2,051 people surveyed at the beginning of April would not use Paym.
The biggest concern was security, with over two-thirds (71%) citing this as a reason, while 39% said they were worried about the consequences if their phone was stolen and 32% had reservations about paying the wrong person or amount.
But the Payments Council says the service is safe.
Paym will use existing secure payment networks, Faster Payments and LINK, so will benefit from the same high level of protection as existing electronic payments.
There will also be checks in place to ensure the safety of your cash, such as password activation on the apps, mobile number verification and confirmation requests as standard. Participating banks and building societies will have to sign up to a security code of conduct to protect Paym users from fraudulent activity.
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New ways to pay
Paym looks to be the beginning of a payments revolution.
Next up could be Zapp payments. This scheme will also use a smartphone, but this time to make it easier and safer to pay for things online as well as in shops. Instead of sharing your card details online or typing your PIN in shops for purchases you’ll be able to ‘zapp’ payments to retailers using a participating bank’s mobile app. HSBC, first direct, Nationwide, Metro Bank and Santander have already signed up and retailers like WHSmith and Tesco are already on board to receive payments in this way.
And the third wave could come from Weve. It’s a project between major mobile operators EE, Vodafone and O2 (who collectively account for 80% of mobile users) to create the ultimate mobile wallet. A new wave of smartphones will come with a chip that allows you to store credit cards, debit cards, loyalty cards and coupons in one place to pay for things in shops and online.
Will you be using Paym? Let us know in the Comments box below.
Earn up to 5% interest from a current account
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