UK mobile payments: Leading the way in innovation

Looking at the person-to-person mobile payment services of the UK, Sweden, Kenya, India, Japan and the US, the paper compares various areas including ownership, infrastructure, speed and the customer experience of mobile banking.

The Council suggests that “much of this innovation has been led by the UK with the most rapid changes in the past 20 years.” 

More specifically, the report highlights that the launch of Paym in April 2014 marks the latest industry-wide payments innovation to increase choice for UK consumers.

It was, indeed, found that the UK’s Paym remains the only industry-wide free to use person-to-person mobile payments service globally and that traditional payments technology leaders (Japan and the US), now lag behind the UK and Sweden on delivering such solutions.

The reasoning behind this is that the latest and potentially most revolutionary innovation in mobile payments is in the form of P2P payments via a mobile device, something that is offered by Swish in Sweden and Paym in the UK. This new service not only allows for the easy transfer of money, but settles the payment made between accounts almost instantaneously.

But although Paym has been highly successful, Kenya’s M-Pesa is quickly gaining in influence, and is one of the main focal points of the report. The success of M-Pesa underlines the importance of mobile payment services being designed with the needs of customers in mind. 

“M-Pesa’s success is undoubtedly influenced by the fact that the service was specifically developed for emerging markets where there are a significant number of unbanked individuals,” states the report. “M-Pesa, unlike Paym, does not require you to have, or is not linked to, a bank account and is run by a mobile phone company and not through a payment clearing scheme.”

Is this something the UK mobile payments industry could be looking at?

Adrian Kamellard, Chief Executive of the Payments Council said: “Mobile technology has changed human behaviour across the globe and in so doing has revolutionised the way we carry out many every day, yet vital tasks. The sphere of payments is no exception to this disruptive trend – so it is interesting to see the influence that local regulatory, cultural and technological differences make to how new mobile payment services are implemented.

“Looking round the world makes it clear that Paym is a world leading service, even when compared with trailblazers such as M-Pesa in Africa. The UK payments industry’s collaborative model of change, which builds upon our existing world class real-time payments infrastructure has delivered real benefits for customers, with a service which – unlike many other places in the world – is free for customers at the point of use.”

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