Paym sputters into view, almost certain to fail

April 29, 2014

Dyslexia mode

Summary:: 30 million customers should have access to Paym. I'm one of the 20 million that don't. This is an epic fail in the making.

Paym, the system which links your mobile phone number to your bank account went live yesterday. In the video above, Rory Cellan-Jones of the BBC and George Charalambous, HSBC's head of mobile banking gave a taste of how it works.

While Cellan-Jones and I share the same device maker and bank, according to Google Play, none of my devices are compatible with the bank's mobile banking application upon which Paym sits. I have both new and old devices running a variety of Android OS variants. C'est la vie. Maybe my bank knows this already because I haven't received any notification of the service either.

That in turn means that I am one of an estimated 20 million banking customers who cannot take advantage of Paym at this time. That counts as a massive #fail, despite claims that Paym can reach 30 million customers from mobile applications operated by customers of the nine banks mentioned on the Paym site.

If that wasn't enough, survey results conducted by Consumer Intelligence suggest that 47% of those surveyed (n=2051) have no intention of using Paym:

Of these, 71% cite security concerns as the reason for their reluctance. More than a third are worried about what would happen if they lost their mobile phone and 32% are concerned about paying the wrong person or the wrong amount. Forty-two percent simply prefer traditional payment methods.

There are other concerns. There is an inherent assumption that whomever I wish to pay using Paym is already registered for mobile banking with their bank. If they're not then Paym doesn't work. On the other hand, using systems like PayPal, which uses email rather than a phone number tied to bank account details, works perfectly well.

Much is made of the fact that Paym sits on top of existing systems so that the potential for fraud is reduced. I don't know whether that is true. What I do know is that existing fraud prevention systems at the banks I use are very poor at picking up false positives, have no idea of my spending patterns and even when fraud does happen, are even poorer at recognising it as such. Is it any surprise then that customers are wary of this service?