UK's Payments Council Launches Paym A Mobile Payments Service

Paym, a new secure way for consumers to link their phone numbers to their account will allow them to send payments directly to each other's current account using just a mobile phone number.

The Payments Council, which is the UK financial body that oversees payment mechanisms, has officially revealed the launching of Paym to be late April or early May.

The service will be integrated into customers'existing mobile banking apps and allow them to transfer money without asking for the recipient's bank account details or sort code. Instead, User types on his phone the mobile number of the person or business he want to pay.

Access to the Paym system will be covered by password or code protection in an attempt to avoid the risk of the phone being stolen and used to raid customers’ accounts.

Customers of nine banks and building societies will be able to use the service, including Barclays, Halifax Bank of Scotland, HSBC and Santander, Cumberland Building Society, Danske Bank, Lloyds Bank and TSB Bank.

To send money, a user will have to log into their bank's mobile banking app, using a pass code as normal.
They will then have to select the recipient of the payment, using their existing contacts or by typing in that person's mobile phone number.
After confirming the name of the recipient they will have to check the amount being paid, type in a reference for it (such as "dinner"), and then press send.
A confirmation message will then be sent to them.
Current levels of security will apply and payments will not be possible without an app's pass code being entered.

Similar systems have been introduced by Barclays with its Pingit system, and by RBS NatWest.

In the case of Pingit, a recipient of a money transfer must have the Pingit app on their smartphone, as well as the sender. The RBS NatWest, system hinges on users having a Visa card.

PayPal's UK customers have been able to send money from their mobile phones since 2006 by text message. In 2008, PayPal was the first to offer a "send money" app when Apple launched the App Store which requires just the phone number or email for the person you are sending money to.