The UK's Payments Council has announced the launch of a new person-to-person mobile payment service called Paym (pronounced pay-em) this spring with a launch date to be revealed next month, once final testing is complete.
The service is revolutionary in that it will allow bank customers to link their mobile phone numbers to their accounts and execute person-to-person and person-to-business payments using their phone number as a proxy without the need to give away their sort code and account number.
At first Paym will be available to customers at nine banks - Bank of Scotland, Barclays, Cumberland Building Society, Danske Bank, Halifax, HSBC, Lloyds Bank, Santander and TSB Bank. They will invite their customers to register via online banking or the mobile app they use, providing their phone number and stating which account they want to link it to.
A few other banks - Clydesdale Bank, first direct, Isle of Man Bank, NatWest, RBS and Yorkshire Bank - will join later this year and Nationwide has announced that it plans to join in early 2015.
Paym will help consumers split restaurant bills or chip in for a colleague's birthday present using just their mobile number, said Adrian Kamellard, chief executive of the Payments Council. He added that Paym illustrates how industries can collaborate to create a service providing substantial benefits to customers.
Game-changing mobile services like Paym will help banks compete with telcos, retailers and tech firms, as well as existing services like PayPal, to secure a share of the rapidly growing mobile money market.