New hi-tech systems could see your phone replace your wallet

Five decades after the first credit cards were introduced to Britain, this year is set to see new hi-tech payments including tap-to-pay mobile phone systems and 'mobile shops'.

Five decades after the first credit cards were introduced to Britain, the country is suddenly awash with hi-tech new ways to pay.

And 2013 promises to be the most revolutionary yet - with hi-tech payments including tap-to-pay mobile phone systems and cards with LCD displays.

Using your smartphone to pay by tapping a device in stores is going to become significantly more widespread in 2013.

Near-field communication chips, which is used in contactless payment cards and Oyster travel cards, has struggled to get going in UK phones - although phones such as Samsung's Galaxy SIII have the chips built in.



The chief stumbling block has been brokering deals between phone manufacturers, networks, banks and payment processor firms like Visa and MasterCard.


Barclays is offering the service via Samsung Galaxy S III handsets on the Orange network.

Failing that, Barclaycard offer a PayTag sticker that you can place on the back of your phone that does the same thing, only with credit rather than debit.


Apple's iPhones are not yet equipped with the NFC chips needed for 'tap-to-pay' transactions.

Phones could also be used as 'mobile shops -  in America, thanks to the successful 'Square' app, customers are increasingly able

charge for goods by simply swiping customers’ credit cards with a reaer attached to a phone.

Although Square has yet to arrive in the UK, a host of rivals - iZettle,  Payleven, SumUp and mPowa–will all next year provide devices on Android, iOS and BlackBerry devices.

The dongle, which transmits the details to the fund-processors just like a restaurant-type device, is simply plugged into a tablet or smartphone and connects via Bluetooth.


The costs vary. Izettle is available for £20 at EE stores. The others are free and can be obtained online.

But merchants will pay a commission of between 0.25% and 2.75% or a flat rate of 25p for each transaction.

Hi-tech new cards with LCD displays could also revolutionise mobile commerce.

Online bank transfers are becoming an increasingly common way to pay for items as more and more banks agree to instantly send the cash to each other.

One problem with this method, however. is that it often requires a separate security device with a screen and buttons to generate a one-time payment authorisation code.

But the MasterCard display card, which merges such a device with a debit card, will be released via Standard Chartered Bank in the test hotbed of Singapore in January.

The cards contain a clock that is synchronised to the bank’s time and produces the correct code at any given minute.

The technology is likely to be rolled out in the UK by the end of 2013 and, with it, cards may later be able to display your balance or details of previous purchases.