The new Paym service to enable more people to transfer money just by using mobile phone numbers can be used by customers of Bank of Scotland, Barclays, Halifax, HSBC, Lloyds Bank, Santander, TSB, Cumberland Building Society and Danske Bank.
By the end of the year, a total of 40 million people will be able to access Paym, when RBS, Clydesdale Bank, First Direct, Isle of Man Bank, NatWest and Yorkshire Bank come on board. By that point, Paym will be available on more than nine out of 10 current accounts.
Paym, which is pronounced “pay em”, has been described as the first industry-wide collaboration in the UK which could potentially link up every bank account with a mobile number.
Although it is anticipated that many people will use Paym to make small payments to friends and family, they will be able to transfer at least £250 a day under the scheme if they want. Some banks and building societies will have a higher daily limit.
People need to actively register their mobile number alongside a nominated current account in order to receive money into that account through Paym.
By the end of last week, more than 300,000 people had registered to be able to use the service.
People do not have to register for Paym in order to send money through the service, although their bank or building society does need to be taking part in the scheme in order for them to do this.
The service will allow people to transfer cash payments on their mobile by using the recipient’s phone number rather than needing to know their bank account number and sort code. It will be integrated into their existing mobile banking or payment app.
To make a payment, users can either select the contact they wish to pay from their phone or key in their mobile number. The app will ask users to confirm the name of the recipient and the amount before the money is sent.
Adrian Kamellard, chief executive of the Payments Council, which is overseeing the initiative, said: “Paying someone back just got easier for millions of people.
“Paym is another safe and easy option to pay friends and family.”
Payments made through the service are made at the same speeds as existing current account, online and mobile payment services.
More than 94 per cent of adults now own a mobile phone and strong growth in mobile- payments technology has already made it easier for people to leave their wallets at home.
Barclays’ Pingit app, which launched in 2012, picked up 2.5 million regular users in just 18 months.
Pingit enables people to make payments using just mobile phone numbers.
Another mobile payments scheme, called Zapp, is set to be launched this autumn.