Leading UK banks sign on to Zapp mobile payment platform
Five leading UK banks--HSBC, First Direct, Nationwide, Santander and Metro Bank--have signed up to integrate Vocalink's Zapp mobile payment service into their existing mobile apps, the BBC reports.
Vocalink's mobile payment platform, which is set to launch later this year, is different from other options because it takes payments directly from the bank account and does not require users to share their account information with a third party, such as a credit card company, the report explains.
Consumers will be able to make payments online or at stores by using the Zapp mobile app. At a store, a customer can use Zapp at the point-of-sale terminal by tapping the phone on a near-field communication terminal, scanning a QR code or typing in a six digit code provided by the cashier.
"We will be the only payment method where at the point of sale the customer can see the real-time balance of their accounts," Peter Keenan, Zapp's chief executive, tells the BBC. "This allows them to say, 'I've got this much money in my account, shall I go ahead and buy this product or not?' And because they are using a smartphone, it allows them to keep a record of all their spending and purchases in one device."
The launch of Zapp in the U.K. will be a bellwether for other mobile payment efforts around the world, judges Gilles Ubaghs, senior analyst for financial services technology at Ovum.
"If Zapp proves successful in the long term, it could prove to be a model for other markets across Asia Pacific and indeed globally," Ubaghs writes in a blog.
"Zapp builds on Vocalink's faster payments infrastructure and enables merchants and banks to bypass the existing payment schemes like Visa and MasterCard by enabling immediate bank transfer payments at the POS for both real world and digital environments," he observes.
For retailers, this can result in reduced interchange fees and faster payment settlement. "For consumers on the other hand, the benefit for e/m-commerce remains significant as it effectively provides a simplified payment mechanism without the need to create a new and separate wallet distinct from their existing mobile bank accounts, and avoids the need for fiddly and unnecessary virtual prepaid wallets separate from other accounts," Ubaghs notes.
- check out the BBC report
- read Ubaghs' blog