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Banks backing Zapp payment system

An Apple iPhone with social media software16/1/14

By Natalie Marchant

Five UK banks and building societies have signed up to the new Zapp mobile payments service for smartphones and tablets.

HSBC, First Direct, Nationwide, Santander and Metro Bank - who have 18 million customers between them - will all use the service, set to launch this autumn.

Zapp will be integrated into the banks and building societies' existing mobile apps.

Customers will be able to see their bank balance and choose which account to pay with before making a purchase.

Pay with your mobile at the checkout

When at the checkout of a shop or business that accepts Zapp payments, customers will receive a six-digit code sent to their mobile device.

Once the transaction is complete, the funds will move in real time to the merchant.

To pay bills sent through the post, customers will be able to scan a printed code into a tablet or smartphone in order to complete a transaction.

Zapp is a subsidiary of VocaLink, the payments provider behind 650,000 Link cash machines.

VocaLink systems also power the Bacs and Direct Debit schemes and process more than 90 per cent of UK salaries.

Banks sign up to mobile payment service

Zapp chief executive Peter Keenan said: "I am truly excited to announce our lead financial institution partners: HSBC, First Direct, Nationwide, Santander and Metro Bank.

"Zapp will go to market with real scale offering simpler, more secure and efficient payments to millions of customers and businesses."

Transactions made using Zapp technology will be afforded similar protections to those using debit cards.

Payments are secure because the service is built into a customer's existing banking app, meaning that only their financial institution will know their account details.

The company say that the five banks and building societies on board account for more than a third of all UK bank accounts.

More Zapp members to be recruited in 2014

Some 60 per cent of UK merchants and retailers will be able to receive payments using Zapp and it hopes to recruit more new members throughout 2014.

Twenty million adults are expected to use their mobiles to pay for goods and services by the end of the decade, according to the Centre for Economic and Business Research.

Barclays' Pingit payments app was launched just before the London 2012 Olympics, has picked up 2.5 million users since.

The app, which is available to both Barclays and non-Barclays customers, lets users make payments using mobile phone numbers.

Almost £1 million worth of payments a day are now sent using it.



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