Over the past few years, the market for mobile payments has risen sharply, both in Denmark and internationally. Banks and PBS have followed the market development closely and are now getting ready to launch a solution for mobile payments.

"In 2009, Danes have started to make more payments using their mobile phones. The current model of premium rate text messages on the telephone bill is, however, more difficult for shops and service providers to process than ordinary payment methods. For instance, a long time can pass before the payment is received, and security can also be a challenge. This is why we are developing a solution which will integrate mobile payments with the existing payment solutions, so that, among other things, processing the service providers' payments becomes significantly easier," says Peter Stougaard, Director of Business Innovation at PBS A/S.

Use your mobile phone for both proximity and remote payments

Although PBS and the banks' work on mobile remote payment is still at its development stage, the outlines of the solution are starting to emerge. For users it will carry on working as it does at present, where they have to send a text message. However, the payment will be taken directly from their bank account or prepaid account rather than from via their telephone bill. The solution is aimed at transport authorities and other service providers who want to offer their customers the option of simple remote mobile payments.

At the same time, a standard for mobile proximity payment (NFC/Near Field Communications) is being worked on as a supplement to remote payments. You simply wave the mobile phone past a reader in the shop, and then the payment is made. This lays the groundwork for future solutions for both near field and remote mobile payments which complement each other nicely. Experts estimate that NFC proximity payments will be widespread in three to five years.

DSB is looking forward to more options
DSB (the Danish railway company) is one of the companies that has good experience with remote mobile payments. DSB customers as well as metro and bus customers in the Copenhagen area have been able to purchase mobile tickets via their mobile phone from home or on their way to the train or bus. Passengers have been very pleased with the solution, and over 600,000 mobile tickets have been sold since January 2009. Despite its success, DSB is still finding the solution more difficult to process than ordinary payments:

"We are very pleased with the existing mobile payments. But in practice, they work as credit schemes for customers, and are also more expensive and difficult for us to process than other methods of payment. We are therefore looking forward to an alternative which will satisfy our needs to a greater extent," says Niklas Marschall, Sales Director for DSB S-train, adding:

"Increased competition generally always gives more quality in the market, and as PBS has both the necessary expertise and infrastructure to create a simple and secure solution, we strongly welcome their initiative."