Barclays bank, which already intertwines NFC chips and antennas into its banking cards in the U.K., has just taken a page out of Apple's book and released a new mobile app that should shake up the U.K. financial game.
Pingit is a smartphone app that lets anyone with a Barclays account and a cell phone send out and receive cash without having to swap long, complex bank numbers (which you'd probably want to protect under most circumstances anyway)—all you need is a phone number or a name. Think of it as the smart, secure, 21st century way to lend your pal 10 quid for a pint after work—and probably pay for a lot more things too.
The app is a proprietary piece of code specially linked to your Barclays account--which you may think limits its applicability. But this lets Barclays pull off a couple of tricks: The app is secured when you set it up by asking you to enter a fair chunk of personal data that the bank already knows, confirming you are the user, with the right account, that you say you are. From then on to access it you have to enter a five-digit PIN code (one more than your standard ATM number). But because the bank then has a secure link to your phone, there's none of your banking data stored on the device itself—the app merely becomes a payment conduit to the funds in your account in the same way your plastic credit card is when you use it in a store, or tap in its numbers into an online merchant's webpage.
The real power of the app is in what it lets you do: If you're a Barclays customer running the app you can give out payments of between £1 and £300 in a single go to anyone else's bank account (Barclays customers at first, but very soon all U.K. bank account holders will be eligible). You can also receive money the same way, up to a maximum of £5,000 in one day.
Don't dismiss this as a gimmick, though, because the app is given the same levels of importance and security as a typical bank card. Barclays has even gone to great lengths to explain how secure it is in a video.
Obviously sensitive to issues that have hit rival NFC-based Google Wallet, Barclays suggests users keep phones locked and un-rooted—but in the same way services like "find my iPhone" let you delete your data from a lost or stolen phone automatically, Barclays can remote-wipe the contents of its app should you call them up.
But the real power of the app is that it allows you to dish out and receive money anywhere you have a phone signal, to anyone with a phone number. Pocket money to your kids, donations to charity, loans to cash-strapped friends, and any other small-amount transaction. In a way it's a more deftly exectued (and possibly more secure) money-sharing system than is offered by Bump—which lets you perform similar small transactions by bumping your iPhone with the person you're paying—just without the extra layer of using PayPal as a conduit for the cash.
If you're a small business it will be helpful in accepting payments from customers, as well as giving out refunds and maybe even paying your suppliers. No NFC, no Square widget stuck on your phone, just the phone itself and an app. Barclays isn't explicit about this kind of use, hinting it's for a more personal function than business uses, but it wouldn't take much to expand the service with full-on customer analytics, loyalty cards integrated into the transactions, coupons, adverts, and so on. These are features that Barclays could charge a tiny percentage for, and yet it would offer the same sorts of advantages that systems like Square tout right now.
In this manner, Pingit sounds a lot like the clever EasyPay system that Apple's slowly implementing in its stores. Apple's service does many similar things (and more) because it can trust the phone owner as a verified iTunes customer, with a credit card on file, in the same way Barclays can trust the user is an account holder. Neither app requires any additional hardware to work, and that's hugely important because new tech is always a barrier that the consumer seems reluctant to step over.
Basically that futurish-sounding mobile payment technology (usually mentioned alongside tech like NFC and Google Wallet) is arriving sooner than you think. In fact, despite what naysayers may suggest, it's really already here—er, there, in the U.K.
[Image: Flickr user Timm Suess]