The big banks of the U.K. are preparing to step up their digital payment efforts as they attempt to fend off the bite Apple is fixing to take out of their customer base starting July 20.
The major high street banking players are launching a payment service to be known as “Zapp” which will allow U.K consumers to “pay by bank” through an app on their mobile phones.
Currently, Barclays is the only big high street bank in the U.K. not offering Apple Pay — instead it is sticking with its own mPay platform, Pingit, a mobile service open to anyone with a smartphone. Barclays will incorporate the “pay by bank” app within Pingit by October. With “pay by bank” Barclays’ corporate customers in retail, transport, utilities, local authorities and financial services will be able to access the app to receive payments going forward.
HSBC, First Direct, Nationwide, Santander and Metro Bank have also signed up to provide digital payments through Zapp — though they are also supporting Apple Pay.
Those U.K. banks are not alone in entering into competition with Apple. Visa and MasterCard have both started offering their own digital services that allow consumers to use their cards in many merchant locations without having to constantly enter and re-enter their number.
Among concerns about the new system is security, which Zapp says will be handled via tokenization.
Mobile banking in the U.K. has overtaken branches as consumers show a marked preference for mobile transactions. Online customers are set to check their current accounts on mobile devices more than 895 million times this year, as opposed to the 705 million times they are set to visit branches, according to numbers released by consultancy firm Caci.
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