The first mobile phone payment system has been launched in the UK. Shops and restaurants including Eat, Pret A Manger, McDonald’s and some Boots stores will be fitted with Barclaycard readers allowing customers with a specially adapted Orange handset to purchase small items by swiping their phones.
Users will first have to load their phones with money from their accounts, in increments up to £100, and will then be able to use it to buy items up to a total purchase amount of £15. The machines will be available in about 50,000 stores across the country.
Contactless mobile phone payment has been promoted as the future of payments by financial services companies for several years. O2 worked with Visa and Barclaycard in 2007 on a piloted scheme to let people use phones instead of Oyster cards on London transport systems.
Barclays had previously predicted that by 2012 it would be normal to pay for items with a phone, and that five years later phones would overtake credit cards. But the lack of handsets featuring near field communication, the short-range wireless technology used for the payment systems, has prevented mobile wallets from becoming a mass market phenomenon. So far just one handset will be available with the system.
Analysts say take-up of the new payment system in the UK, where consumers already use debit cards to make small payments, may be slow. Mobile phone payment is more popular overseas than in Britain. Japan has more than 30m consumers using a phone payment system called Mobile FeliCa.