Barclays is arguably the bank that’s setting the bar for what the UK’s payments sector will become.On 15 June, it was revealed that the banking habits of Brits have changed over the years to see mobile become the dominant channel for managing finances. With smartphones used 895 million times in 2015 already, the devices are set to outpace branch visits, internet and telephone banking combined in the next five years. Barclays has been a step ahead of the game for some time now, having launched apps for customers years ago. The Barclays Mobile Banking app allows management of all Barclaycard accounts, while the Pingit app is available to non-Barclays customers and supports gifting, money transfers, payments and more. And in February 2015, Barclays continued innovating to become the first bank in the UK to process payments using Twitter handles – a move that facilitates transactions between individuals as well as small businesses. “We are always on the lookout for new and exciting ways to make people’s lives easier and customer feedback plays a big part in how we chose to further develop our apps,” Darren Foulds, director of Barclays Mobile Banking and Pingit, said at the time. “Adding the ability to pay people or a small business using just a Twitter handle brings together a social and digital experience to create a new step forward for mobile payments in the UK.” In the wider world of fintech, American bank Citi has unleashed a plan to harness the platform in order to “change the world”. Real Business attended the financial establishment’s Citi Mobile Challenge in May, during which we spoke to the bank’s head of Global Digital Acceleration, Jorge Ruiz.
He told us that 66 partners were on board, supporting developers with different software and tools, and Uber and MasterCard were among them. Opening up on why fintech was so important to Citi, Ruiz explained: “Anything you do in your life has something to do with a financial product – whether that’s your savings, paying for something, getting ready for retirement or buying a house. “As one of the most important industries in the world, it will be disrupted. It cannot be the only industry that will stay the way it is.” Seemingly well aware of this trend, the ever-inventive Barclays has embraced the wearable market with new “bPay” contactless payment devices for British consumers that will roll out under Barclaycard’s watch.
Digital wallet bPay is able to sync up to multiple bPay devices and the launch follows the arrival of a bPay band in June 2014 at Pride in London and Barclaycard presents British Summer Time in the capital’s Hyde Park. In addition to the wristband, new products include a fob, which can be added to keys or a bag, and sticker that can be added to flat surfaces. According to the firm, registrations for the band spiked in September when Transport for London enforced a contactless travel procedure and barred cash. Like a contactless card, the bPay devices can used via a tap for payments worth up to £20 – though the limit will increase to £30 at more than 300,000 locations nationwide from September.
Read more on disruptive payments:
- What will Apple Pay mean for British SMEs and the UK’s retail industry?
- The UK’s ecommerce market is expected to double in size by 2018
- Annual spending via mobiles to hit £53.6bn in UK by 2024
Mike Saunders, MD, digital consumer payments at Barclaycard, said: “We’re in the midst of a sweeping change in the way we pay, with cash-dominated transactions being replaced by ‘touch and go’ contactless technology that has made it easier, safer and faster to make low-value payments.“The launch of our bPay band last year was an evolutionary step for the business, with highly positive customer feedback. People told us they are looking for new ways to pay that offer greater flexibility and choice, and fit better with different lifestyles. “So we’re building on this success with our expanded bPay proposition, and have produced a range of wearable products that you can use to pay for everything in your day – from travelling to work and grabbing a coffee, to buying your lunch or picking up groceries from the supermarket.”
As with Pingit, bPay is open anyone with a UK-registered Visa or MasterCard debit or credit card, regardless of whether they’re a Barclays or Barclaycard customer. Elsewhere, users can add funds to their digital bPay wallet on the move with the mobile app, online, or set up an automatic top-up allowance. bPay items go on sale from 1 July and, priced at £15, £20 and £25 for the sticker, fob and band respectively, the items are significantly cheaper than the Apple Watch, which varies between £300 to £13,500. Of course, the Apple Watch has far more functions than the bPay items, but one of the key uses that Apple is touting is Apple Pay. Indeed, Apple revealed on the 9 June it was going to bring the Pay service from beyond the US and into the UK in July. Companies already signed up include Marks & Spencer, Boots, Starbucks, JD Sports, New Look, Nando’s, McDonald’s and more. However, the system only works for users of the iPhone 6, iPhone 6 Plus and Apple Watch, which will limit the level of adoption it can actually receive. Barclays, on the other hand, is more affordable and has the potential to become more ubiquitous. In addition to availability on the bPay e-store, bPay products will also be on sale on the high street in the Snow + Rock-owned CycleSurgery and Runners Need stores. As well as launching to stunt the growth of Apple Pay, bPay’s expansion follows data from the UK Cards Association, which found that contactless payments trebled to £2.32bn last year, accounting for 319 million transactions. “bPay is a clear example of the reality of payments in the UK today. The British public is embracing digital ways to pay because they value the benefits of doing so: security, convenience and speed,” said Kevin Jenkins, UK & Ireland MD of Visa Europe. “From our own research we know consumers see their bank as a key provider of this kind of innovation. Going forward the challenge is to continue to answer this demand. As a nation we are already a world leader in designing and building payments. Ideas like bPay can help ensure we remain that way.” By Zen Terrelonge
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