Coming soon: Using a mobile phone will be the main payment method for people and small businesses! By the start of next year, every bank customer in the country may have the ability to transfer cash between bank accounts, using an app on their mobile phone.
Barclays became the first bank to launch such an app for its own customers last month – “Pingit”. Now the wider banking industry is in the throes of setting up a database which can link all bank accounts to their owners’ mobile phone numbers.
This in turn will let every bank or building society plug their own systems into the database while offering their own apps to their customers.
How it will work
Anyone wishing to move money from their account to someone else’s will have to have registered with their bank and to have activated its app on a mobile phone. The app will let them select the person they want to pay; knowing their mobile phone number is key here. The recipient must also be registered with their own bank so they can receive any such payments, even if they do not want to use an app to transfer any money on their own behalf.
Under the new system, the money will be transferred instantly from your bank account to the recipient’s bank account, using the banking industry’s “faster payments” system.
No more hanging around for three days for a cheque to clear. So if you are at home one evening and receive a call from your son or daughter needing money to tide them over, you could move the money from your account to theirs within a minute or so.