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How to Use Mobile Payment Services in the UK
Jamie Finch
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March 29, 2023
The combination of fast internet speeds and increasingly powerful smartphones and other devices have revolutionized many aspects of how we work and play. Up until this revolution, tasks like shopping and paying bills had to be done in person, which was often inconvenient, time-consuming and even costly. Nowadays, we can undertake such tasks, and many more, from the comfort of our own homes and offices.
As such, numerous services have been developed that make it easy for you to send payments online, whether to shop from a store or send money to a friend. These services will have a range of features that will make them more or less suitable for your needs, and there’s a wide range of options to choose from.
This article looks at the different types of mobile payment services in the UK, and how to use them.
Why use mobile payment services?
Mobile payment services are popular for various reasons, with some of the most common listed below.
Convenience
Mobile payment services let you pay by mobile for goods and services. Depending on the specific service, you can also pay from desktop PCs, tablets, and other devices. As such, you can make payments without having to physically travel to make transactions, which means losing valuable time. This convenience is a godsend to many people, especially those who are busy and those who have mobility issues, for example.
Security
Reliable mobile payment services are secure, meaning your money is safe. The software involved uses the latest technology that helps ensure your money and personal details are inaccessible to others. Mobile phone payment services are made even more secure with hardware that uses the latest security measures. For example, smartphones are often all but impossible to use without a password, keeping your details safe should you lose your phone.
Organisation
Mobile payment services operate digitally, meaning every transaction is recorded. Having readily accessible reports of previous transactions can make it easier for you to manage your finances. Some services will even create useful reports that can help you make impactful decisions.
Having digital records can also be useful when it comes to overcoming discrepancies. These records help make it easy to identify payments and match them with sales. Some services will even let you set reminders or payment schedules to help ensure you pay bills and other payments on time.
Choose your preferred service
There are numerous mobile payment services to choose from, and which works for you will depend on your preferences and circumstances. For example, you might need a solution that makes it quick and easy to shop online, while others will want products that help make it easier to shop in brick-and-mortar stores.
Different services will also have different fee structures that could be good or bad for you, depending on how you use the service. Another essential aspect to look for is compatibility and how many other people or businesses accept the payment method.
As such, it makes sense to read into each service first so you can be sure it provides the exact services that you need. It’s also a good idea to ask around about other peoples’ experiences using mobile payments.
Types of mobile payment service
There are several types of mobile payment service to choose from and each type can be quite different from the others. Below are some of the options you are most likely to encounter.
Mobile peer-to-peer
Mobile peer-to-peer services are among the most commonly used mobile payment services. They include popular services like PayPal that allow you to easily send and receive money to online stores and other businesses.
PayPal is particularly popular because so many companies globally accept it, giving you more shopping options. Mobile peer-to-peer services can also be used privately, making it easier to send money to friends and family. Another reason for the popularity of these services is that they’re easy to set up and use.
Mobile wallet
A mobile wallet lets you use a mobile device like a smartphone as a credit card. They can be used to make payments online, while you can also use them in brick-and-mortar stores, which usually takes a fraction of the time when compared to traditional methods.
To use a mobile wallet in a brick-and-mortar store, all you need to do is tap your device against a compatible payment terminal and the transaction will occur automatically. This means the store will need the necessary tools, although most modern shops will have the required technology. Mobile wallets can also be used to send or receive money from friends and family.
Mobile point of sale
A mobile point of sale is typically used by stores and other businesses to make it easy for their customers to pay. The payment method involves a mobile device that customers can use to pay for their purchases with a mobile wallet or similar.
Mobile points of sale are beneficial in numerous ways. For example, they can speed up transactions, helping to keep queues to a minimum. They can also enhance the customers' experience, helping companies retain customers.
M-commerce
E-commerce is one of the main driving forces behind sweeping changes in shopping habits, with many consumers now opting for the convenience of shopping from home. Of course, e-commerce was given a boost by Covid lockdowns in 2020, but the model was already surging before the virus was discovered.
E-commerce covers transactions that are carried out online. M-commerce is a sub-category of e-commerce that specifically involves purchases made on a mobile device, rather than a desktop computer. There are numerous m-commerce solutions available, such as mobile app payments that help to simplify the process for shoppers. M-commerce is particularly popular for the convenience it offers to consumers, even letting users shop when stuck in traffic.
SMS payments
The short message service (SMS) has been around since the 90s and has proven highly popular since its introduction. However, the service is gradually becoming obsolete thanks largely to services like WhatsApp that offer more functionality.
But while many people are favouring newer, more advanced messaging solutions, SMS is still a useful tool for some. For example, SMS mobile payments can be just as convenient as other types of service because they send money to a phone number. SMS payments are less common in wealthier parts of the world where more people have advanced smartphones, and are more common in less affluent countries.
Setting up your payment system
The exact process of setting up the account will vary from service to service, but you will be prompted on what you need to do. The process can also usually be done online, making it easy. Many mobile payment systems will be available to use as soon as you have set them up, although you might have to wait a few days in some cases.
What you will need
Setting up a mobile payment service typically involves connecting an app or similar to your credit card or bank account. As such, you might need to open a bank account first and ensure it lets you perform online transactions. You will also likely be asked for ID, and any bank account you use will usually have to belong to you or your company.
What else you need depends on which type of service you choose. For example, you will need to have a reasonably modern smartphone to use a mobile wallet, while many others will be happy shopping from a PC or laptop.
Maintaining security
One of the biggest concerns over mobile payment services in the UK and elsewhere is security. For example, somebody might gain access to your bank accounts if they steal or find your mobile device. Fortunately, developers have been keen to develop solutions that help make mobile payment services as secure as possible.
Such solutions include features like two-step verification. Devices and software that use this method require additional information to help prevent unauthorized access to accounts. One of the most popular methods sends a verification code by SMS, which must be input before access is granted to an account.
However, even the best technology is not as effective at keeping you safe as taking necessary precautions. Keep your mobile device in a safe place and ensure nobody knows your passwords. It is also recommended to change passwords regularly and avoid using combinations that are easy to guess. You should also take the time to set up additional security measures, like two-step verification.
Summary
Mobile payment services in the UK have helped streamline processes and make shopping and other transactions easier for millions. Not only do they offer convenience and security to individuals, but they also help enhance the shopping experience for businesses. Mobile payments are also digital, meaning they can collect valuable data that can be used by marketers.
As mentioned, which option works best for you depends on variables, such as how you will use the device and which technology you will need. And as the development of online payment services continues, you can expect to see even more effective services being introduced in the future.
