Person-to-person mobile payments service Paym will be rolled out by Britain's banks at the end of this month.
Similar products exist elsewhere, very successful with Consumers for P2P and also P-2-SME payments
The UK now has 2-3 meaningful Mobile operating systems covering 90% of the UK population, and a UK Wide Mobile Payment solution that supports 90%+ of the UK's banked consumers... A good venn diagram of enablement and access from a merchants perspective.
Provided the user experience is good and the first time payment set up experience is not too slow, I predict the arrival of many 'PayM' derived Mobile Mashup apps that will assist SME's to use 'PayM' to accept mobile orginated bank to bank payments as
well as the target P2P market.
Nice work UK Banks and Payments Council! Its a shame (my bank) First Direct wont be playing untill the autumn! I will need to open another account so i can test fly PayM sooner than that!
"I predict the arrival of many 'PayM' derived Mobile Mashup apps"
Do you predict that the participating banks will provide a common API for apps to use?
Well, given that Vocalink operates Zapp in addition to providing the primary infrastructure platform for Paym, its not difficult to see some synergies. Paym is primarily a P2P service, and although the technical plumbing to enable consumer-to-business payment
is likely to be largely the same, you can bet that the commercial arrangements will be very different.
Dave, I am not sure API is the route which banks are considering. Judging from Zapp efforts in a very similar field, the user is ultimately directed to the bank's own app for authentication etc. That kills the flow for such use cases as retail payments.
What's missing in Paym offering - to take its true potential to the Moon - is central "federated" authentication service. Vocalink (the "glue" behind Paym) offered to run such a service. "Naturally", the banks "passed" (for now...)
There is another way to use Paym rails for quazi-mashup...
Customers of two slovak banks are using P2P service called
VIAMO already 9 months and I love it! Its so easy to send small amounts (currently limited to 150€) via smartphone. There are more than 55k users registered and they did close to 1,8 mio.€ transactions. The average transaction amount is 9€. Person-to-business
is planned to be launched for this year.
Does anyone know how this relates to Barclays Pingit? The two seem awfully similar but does Paym run over the Direct Debit rails too? There's some mention of PANs being processed, so maybe it's debit card.
I wonder what Barclays think about this. I could imagine they would either be pleased or upset that they've got competition in this space.
I see that the FAQ  says that "When you select or input your contact’s mobile phone number and the amount you want to pay, you’ll see a confirmation screen which shows the recipient name as registered to the mobile number on the central database."
This could be a great way of finding out who called me from this number :-)
Stephen - PingIt and paym both run over the same FPS rails.
But back to APIs. How is this "mashup" going to develop if the banks won't open up their APIs? And if they are going to open them up, then shouldn't the Payments Council be working on a common API so that apps can use any customer's bank account?
Actually, I expect they are probably working on this already, especially given the trajectory of the EU consultation on XS2A.
Paym is not the service conceived (or greatly desired, as far as I understand...) by banks. Hence, they don't (yet?) have many (any?) incentives to open it up beyond the original idea of P2P payments.
However, Paym has the potential to reshape the payment infrastructure beyond recognition by displacing both the card networks and the acquirers. Direct instant a/c to a/c transfers are "self-settling" and "self-reconciling" from that perspective...
The problem of API - the need for common interface/basis for authentication. I don't think banks are ready for that yet... If you do authentication via a bank's app, that kills UX for third parties.
Hi Dave and Alex,
I agree with Alex's comments on authentication and UX. So comments from my side to make the discussion even more lively. I´m wondering how PSD2 is going to influence this ´API´ topic (as it is expected to force the banks to open their accounts for 3rd party
PSPs by exposing an API). I also believe that HCE (host card emulation) in Android has the potential to become this authentication interface where Alex was refering to. Although HCE has recently become available, there are already interesting showcases like
Sabadell and PayPal. If it is, I´m quite interested in the responses of Apple and Microsoft.
I think the Commission want a standard pan-European minimum API. The banks should be working on shaping this already. Will blog.
Steven, re your last point, Barclays Pingit says: "Once registered, you can make payments by giving us the recipient’s mobile number (before doing this, please check they are happy for their number to be shared in this way and ensure the number you use is
current and correct as we will not be responsible if you send money to the wrong payee)."
Wonder if any of the participating banks is using QR codes to make the account linking process frictionless.
Account linking is done from within a banking app, via "opt-in" (1-step, 2-sec process).
@AlexP: When I clicked thru' the procedures for Barclays, HSBC and a couple of other banks, I got the impression that they wanted the customer to first download and install their own mobile banking app (e.g. PingIt) in order to link their account to PayM.
That sounded a bit circuitous. But, if this can be done in a couple of seconds via NetBanking, if that's what you mean by "banking app", then it's indeed highly frictionless.
While I don't have the figures, a lot more P2P and P2B transactions happen via cash / cheque / NetBanking than mobile banking today. PayM has the potential to convert a lot of that traffic to the mobile channel provided it was available directly to the users
of these traditional channels. I noticed that Lloyds Bank is at least one bank that links PayM to NetBanking, not mobile banking. In fact, "You don’t need to register to send payments." according to its website.
This makes a lot of sense since making PayM a part of the mobile banking app (e.g. PingIt) underutilizes its full potential.
© Finextra Research 2016