"TECHNOLOGY AGNOSTIC": Zapp can use NFC to initiate payments

The UK's HSBC, First Direct, Nationwide, Santander and Metro Bank are to provide their 18 million UK customers with the ability to make NFC and QR code payments from next year, using an online and in-store mobile payments service that integrates with the banks' existing mobile apps.

The banks have all signed up to use Zapp, a mobile payments startup formed by payments infrastructure operator VocaLink. Merchant acquirers WorldPay, Optimal Payments, Realex and Sage Pay have already signed up for the service. Together, the four processors' customer base includes 60% of UK merchants.

Zapp uses secure digital tokens that mean consumers don't need to reveal any of their financial details to merchants during a transaction. It is also fully integrated into financial institutions' mobile banking apps, enabling consumers to see their account balances and select from multiple accounts when they make a purchase.

The solution is technology agnostic at the point of sale, the company told NFC World, leaving the route open for NFC, QR codes or other technologies to be used to tie the terminal and the mobile device to the transaction.

A video produced by Zapp shows how the service will be used to make online purchases on a mobile phone:

"Zapp will go to market with real scale offering simpler, more secure and efficient payments to millions of customers and businesses," says chief executive Peter Keenan.

"Our customers want the choice to be able to pay on the go using mobile technology, and the Zapp proposition is second-to-none with its capabilities," adds Santander's Steve Pateman. "Zapp helps us meet the growing demand from our customers to use their mobiles to pay for goods and services swiftly and securely."