New Paym mobile banking service goes live
Paym - the new mobile payments service - launches today, allowing millions of high street banking customers to send and receive payments quickly, using just a mobile phone number.
The Payments Council says more than 30 million customers of Bank of Scotland, Barclays, Cumberland Building Society, Danske Bank, Halifax, HSBC, Lloyds Bank, Santander and TSB will be able to use the service, pronounced 'Pay-em'.
This will expand to Clydesdale Bank, First Direct, Isle of Man Bank, NatWest, The Royal Bank of Scotland and Yorkshire Bank later in the year - at which point Paym will be available on more than 90% of UK current accounts or 40 million people.
Nationwide Building Society plans to join the scheme in early 2015, while Metro Bank and Ulster Bank are finalising plans to join the scheme.
The service will allow customers who have registered their phone number to their current accounts to transfer money between each other just by tapping in the payee's phone number. It will be integrated into existing mobile banking or payment apps so there's no need to register for Paym separately.
Users will also be able to check the name of the recipient before confirming the payment, so they can be sure they are sending it to the right person. Then the money will arrive in the recipient's account almost as soon as the transfer is made, using existing Faster Payment technology.
The Payments Council said Paym will help UK consumers who mount up an estimated average of £255.81 each year in IOUs and other informal loans to each other.
Safe and easy
Adrian Kamellard, chief executive of the Payments Council, said: "Paying someone back just got easier for millions of people. Paym is another safe and easy option to pay friends and family - after all, you probably already know all your friends and family's mobile numbers, so why not use them if you need to send them some money?"
While Paym is the first time that the majority of banks will take part in a mobile phone payment service, mobile payments technology is not new. A service called Zapp already provides the same service for people who want to pay businesses or retailers.
Meanwhile, PayPal has provided person-to-person mobile payments for the past eight years in the UK via text messages. You just need a phone number or email address for the person you're sending the money to.
This is a mutual organisation owned by its members and not by shareholders. These societies offer a range of financial services but have historically concentrated on taking deposits from savers and lending the money to borrowers as mortgages, hence the name. In the mid-1990s many societies “demutualised” and became banks. One academic study (Heffernan, 2003) found demutualised societies’ pricing on deposits and mortgages was more favourable to shareholders than to customers, with the remaining mutual building societies offering consistently better rates. In 1900, there were 2,286 building societies in the UK; in 2011, there are just 51.