Zapp uses secure digital 'tokens' so that customers don't need to reveal their financial details to merchants

Sainsbury's Asda sign up for Zapp mobile payments

Leading British retailers including Sainsbury’s, Asda and House of Frazer have agreed to roll out mobile payment system Zapp in 2015.

The firm – a subsidiary of VocaLink, the company behind Link cash machines – announced in January that banks representing 18 million customers have adopted the service. These have now been joined by other brands such as Thomas Cook, Clarks, Dune, Spar, Best Western and the Shop Direct Group, which owns, and Littlewoods.

Payments made via the service work through secure digital ‘tokens’, which mean customers don’t need to reveal any of their financial details to merchants when they are shopping, and all Zapp payments will be covered by similar protections to those already existing for debit-card payments.

Jon Rudoe, digital and technology director at Sainsbury’s, said: “We know that the way that our customers shop is changing and we’re always looking at new and innovative ways to improve the experience. We’re one of the first retailers to sign up to Zapp to give our customers a quick, secure and convenient option to pay – both online and at the till.”

The service will be integrated into the existing mobile apps of those banks that have already signed up, and users will be able to see their account balance before they pay, as well as choose which account they want to pay from.

When customers get to the checkout a six-digit code will be sent to their mobile device by the merchant that enables them to pay for goods. Alternatively they will be able to scan a code into the handset to make a payment.

According to Zapp, the system also has benefits for merchants as money will move instantly in 'real-time' into their account and Zapp transactions are a fraction of the cost of cards or other alternative payment methods. The fact the system uses digital tokens also means merchants do not need to store card details or incur the expense of Payment Card Industry Data Security Standard compliance.

The core Zapp technology has been built, according to the firm, and it is currently working with banks and retailers to integrate the technology into their systems, with pilots planned ahead of a nationwide launch.

Peter Keenan, chief executive of Zapp, said: “Today is a hugely significant milestone in the history of money in the UK. At last the promise of a truly mobile and digital payment method will become a reality, meaning easier and more secure checkouts for millions.

“It’s amazing to have the support of such well-known retailers. Together with our other partners this means millions of consumers will be able to shop at tens of thousands of merchants up and down the UK at launch.”

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