All customers are expected to be able to use their phones to pay for everyday items within three years in "the biggest revolution in payments since plastic cards were introduced over 40 years ago."
Orange and Barclaycard have formed a long-term strategic partnership to bring mobile payments to British consumers. The communication and banking giants, who have a combined UK customer base of 28 million people, will jointly develop solutions that "let customers use their mobile to both make payments and stay in better control of their finances".
Under the agreement, Orange and Barclaycard will launch co-branded Orange/Barclaycard products and services in a range of markets:
Customers will be able to use their mobiles to pay for goods and services at retailers using contactless technology, by simply waving their handset against a reader. Both companies will be looking to expand the partnership to include other contactless services within ticketing, transport and rewards. MasterCard will provide the payment capabilities for the transactions.
The partnership between Barclaycard and Orange will also enable market-leading mobile alerts, servicing capabilities and new banking applications, all of which will help customers keep in control of their finances while on the move.
Over the next few months customers will start to see the benefits of the partnership with a host of marketing opportunities currently being finalised by Orange and Barclaycard.
"Today you pay for things by cash or on your credit card," says Tom Alexander, CEO of Orange UK. "Tomorrow, you'll use your mobile to buy the things you want, whether that's on the high street or the internet."
"These are the services that will change the way we live and work for the better, and are evolving the way we interact with each other and the way that companies serve us," he added. "This new partnership with Barclaycard is at the forefront of that kind of thinking, and our customers will benefit from the leading-edge technology that both Orange and Barclaycard can provide."
Antony Jenkins, CEO of Barclaycard, said: "This partnership brings together a leader in communications and the UK's leading payments brand with the aim of revolutionising the way people pay. There has been a lot of talk about mobile payments and now it's going to become a reality for our customers because of Barclaycard's commitment to contactless technology and the coming together of two dynamic and imaginative organisations."
"Both Barclaycard and Orange have a heritage of innovation and can see how mobile communications and payments can come together for the benefit of our customers," he added. "I believe that all our UK customers will be able to use their mobile phones to pay for everyday items within three years."
Orange, Barclaycard and MasterCard all have a long history of involvement in testing mobile payments:
- Barclaycard introduced contactless technology on credit cards in September 2007 with the launch of Barclaycard OnePulse, a three-in-one Oyster, credit and contactless card. All Barclaycard Platinum cards now include contactless technology and over 1.5 million contactless Barclaycards are now in issue.
- Barclays Bank began rolling out contactless Visa debit cards across the UK at the beginning of March. Up to three million customers are expected to have been issued with contactless debit cards by the end of the year and the majority of Barclays debit card customers will have contactless cards by 2011.
- Barclaycard took part in a six month trial of the O2 Wallet in London from November 2007 to May 2008 with Transport for London, Visa Europe, TranSys, Nokia and AEG.
- Around 8,000 retailers already accept contactless payments including many outlets of Pret A Manger, Coffee Republic, EAT, Books etc, Krispy Kreme, Threshers and thousands of independent retailers, with more installing the technology every week.
- Under the UK's contactless card system, consumers can use their cards to make transactions of £10 or less without entering a PIN.
- In January, Orange revealed it had been working with smart card and SIM specialist Sagem Orga for more than a year to develop a custom SWP-enabled NFC SIM that is tailored to the mobile operator's specific requirements.
- In November 2008, MasterCard launched Mobile MasterCard PayPass, a solution designed to make it easy for member banks to offer NFC services to their cardholders.