Five Banks Sign Up For Zapp Mobile Payment Service
Zapp hopes to establish itself as industry standard in the UK
Five UK banks will add the Zapp mobile payment system to their smartphone and tablet applications, allowing their customers to make purchases online and in participating retailers without the need for cash or a credit card.
Zapp, a subsidiary of payment system firm Vocalink, will be integrated into HSBC, First Direct, Nationwide, Santander and Metro Bank’s applications ahead of a planned Autumn launch, and it is hoped that more banks will add support in the near future.
Zapp security
It is claimed that Zapp is more secure than other forms of payment because no details are shared, and businesses which offer the service to customers get instant transfers while paying less than alternative methods.
Users who opt to make payments using Zapp on their smartphone, tablet or PC will be directed to their bank’s app, while physical bills can be paid for by scanning a QR code. Purchases in physical retailers can be made either by using Near Field Communication (NFC) technology, scanning a QR code or by typing in a six digit code provided by the shop.
Mobile payments have not yet taken off in the UK, and early trials have been disappointing: O2 is shutting down O2 Wallet at the end of March. Analysts believe that Zapp’s integration with existing banking applications gives it an advantage, although it must sign up more banks if it is to truly become anything resembling an industry standard.
Industry standard
“The ability to provide scale is a critical success factor for mobile payments and Zapp has made a promising start by signing the financial brands announced,” says Eden Zoller, principal analyst in Ovum’s consumer team. “However, to succeed in its ultimate goal of becoming a single, industry wide m-payment platform, Zapp will need to get the other major UK financial institutions behind it, such as Barclays that has its own Pingit application that is proving popular in its own right.
“Alongside this with more countries and regions developing faster payments like infrastructure, if Zapp proves successful in the long term, it could prove to be a model for other markets. Visa and MasterCard will likely be watching developments closely.”
Mastercard and Visa have both developed competing mobile payment systems, while EE is one of a number of operators to have launched a wallet service. PayPal is also keen to establish itself in the market and has rolled out PayPal Here, a service which allows businesses which traditionally deal in cash to accept card payments.
What do you know about the smartphones of 2013? Try our quiz!
