Circus, the trendy London restaurant and bar, now allows customers
to pay for their meals and drinks using their mobile phone.
Using mobile devices to pay for small transactions - known as
micropayments - is expected to be a massive growth area during the
next few years. Research group Forrester has predicted that the UK
mobile payment market will be worth £2.8bn by 2005.
With the advent of wireless technologies such as Bluetooth,
micropayments could also be used to buy goods from vending machines
or purchase rail tickets.
Russell Norman, manager at Circus, said that, as mobile phones play
an important role in the restaurant's customers' lives, the company
was enthusiastic about a mobile payments system.
"When [micropayments systems provider] Paybox approached us, we did
not have to think twice about integrating it into our payment
infrastructure," he said. "The integration process only took a
couple of hours and the costs we incur per transaction are
significantly lower than those of credit card companies."
Paybox launched in the UK at the end of September and has signed up
a number of online merchants, including Lycos and Eurobet. Paybox
said Circus is the first of many offline partners - a number of
announcements are planned for 2002.
Vodafone has announced that from January its subscribers will be
able to use their handsets to pay third parties for ringtones and
phone graphics. Vodafone will take a 20%-25% commission on each
transaction.
How does Paybox work?
To pay using their mobile phone,
a customer first has to register with mobile payment service
provider Paybox.
The retailer enters the customer's mobile number into their
existing payment system, which is integrated with Paybox. After a
few seconds, Paybox calls the user's mobile to request a four-digit
Pin code to authorise the transaction.
Once authorised, Paybox informs the retailer, then debits the
user's bank account. The user and the retailer both receive a text
message to confirm the payment.