Living on mobile money


Rory Cellan-Jones tries living without money

A couple of weeks ago I wrote about my frustrating efforts to use various new mobile money applications on my phone. I promised then to have another go, to give up cash and try to pay by phone alone. So, how did it go? Not very well, I'm afraid.

I started by loading up my phone with a variety of apps which - supposedly - would help me get by without cash or even cards. My main weapons were to be O2 Wallet and Barclays Pingit, two new services which allow you to send and receive money from your phone. But I also installed the Paypal app, and a range of others that allow you to buy a coffee or pay for a taxi from your phone.

Within minutes of starting, I ran into trouble. It was my turn to buy the office tea and coffee round, and the coffee outlet only took cash. No problem - I would get my colleague Anthony to pay and refund him via one of my mobile money pay-by-text services.

With Barclays Pingit playing up (I never got it to work, even after deleting the app and going through the lengthy verification system again) I turned to my O2 wallet. Just two or three passwords later, I had texted a £2.80 money message to Anthony.

Starbucks coffee Coffee and taxis worked. Other items... not so much

Then the fun began.

He spent days - quite literally - trying to make sure this and a couple of other payments from me made their way from his phone into his bank account. Much of that time was spent in increasingly intemperate phone conversations with O2. At one point the company told him their "triage unit" was on the case. Anthony's verdict? "No need for triage - it's terminal!"

I quickly realised that although I wanted to rely solely on my phone, this approach wasn't going to work. I would need to use credit and debit cards as well, plus my Oyster touch-and-go card for travel around London.

By paying for meals via my debit card - which meant I had to spend more than £5 - I did manage to get by without cash for a couple of days.

Then I took a trip to Oxford and had my first failure.

Getting on a bus to the city centre without a travelcard, I found myself obliged to dip into my pocket for some coins to pay the fare. And my bus trip proved a timely example of how useful mobile money could be if it were more widely adopted. On a busy route, every time we stopped dozens of school children and students queued to pay by cash, making our progress very slow.

While neither of my mobile money services proved at all useful over the week, there were two things - taxis and coffee - that proved easy to pay for by phone. The taxi app market is now fiercely competitive and I found Hailo, a service that lets you order a London cab, pretty efficient at delivering a driver to me within five minutes.

Rory's bus ticket Paid for in cash

I also tried Ubicabs to order minicabs, and this again worked fine - although my driver ended up asking me to navigate to my destination. These services make it very easy to move around without cash or credit cards - if only in the London area - but they have one major downside. You end up racking up big bills without even thinking about it.

The same applies with the Starbucks app, which allows you to load money onto a virtual payment card on your phone, then swipe your phone against a reader to pay for coffee or a sandwich. Because this was the only easy way I found to buy food from my phone, I ended up spending far too much on cappuccinos.

When I ended my experiment, I breathed a sigh of relief - as did my colleague Anthony, who is still trying to extract from his phone the money I owe him. Trying to live off mobile money, which is supposed to make life easier, has been a stressful experience. The inevitable concerns about security are making most of these new services so complicated to use that you have to be slightly deranged even to bother.

That is not to say the whole idea is doomed to failure. We will see further innovation over the coming weeks as payments firms unveil plans to allow visitors to the London Olympics to pay with their phones.

But here's my advice to the companies pushing these services - your "triage units" are in for a busy time.

Rory Cellan-Jones Article written by Rory Cellan-Jones Rory Cellan-Jones Technology correspondent

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  • rate this

    Comment number 81.

    Security is the least of my concerns because it should be a damn site more secure than cash and if it goes missing it's the bank's problem not mine. Which is why I'd probably choose a bank's system rather than a telco. It's just a shame that there's nowhere to use it, as Rory found - early days, I suppose.

    Those recommending m-pesa should look at the charges and you'll realise that it's extortion

  • rate this

    Comment number 80.

    The only way truly electronic cash will work is if biometrics get so good that it a computer can instantly tell its you just by looking. With sensors telling what you've bought so remove all queuing

    I can't see having to use a card or phone will do anything than open the way for the banks to charge per transaction they are pushing for.

  • rate this

    Comment number 79.

    "59.The Realist
    29th May 2012 - 14:27
    Never, ever, will the BBC actually say that the Apple iPhone is useless for something"

    What has the make of phone have to do with this exercise? Mobile money apps are not exclusive to the iPhone so what are you blithering on about man?

  • rate this

    Comment number 78.

    Correction to my earlier post I mentioned AES, I was thinking of RSA as a public key encryption scheme

  • rate this

    Comment number 77.

    59.The Realist
    29th May 2012 - 14:27
    Never, ever, will the BBC actually say that the Apple iPhone is useless for something and this report is evidence of that. (...etc...)

    What's it got to do with Apple? I'm no fan of theirs (as my posts here will verify) but it's not their fault if those who wrote the app for Barclays/O2/whoever didn't do it properly...

  • rate this

    Comment number 76.

    There are a few things to be said for using a phone, not the least of which is the ability to ignore abysmal security on most cards and use a good secure connection. Using a set of public keys like AES could provide a way to isolate your specific details from the store owner, and not have to worry about their security would require the computing power of a phone, but would be much more secure

  • rate this

    Comment number 75.

    Everything costs and I don't always carry physical 'cash' but I do my mobile phone.

  • rate this

    Comment number 74.

    Tom955 - whereas when it goes into a bank account it gets fed into the casino mill where countless millionaire investment bankers get to gamble it risk free, with only a bonus to look forward to. Knowing us mugs are going to be picking up the tab.

    Let me pay the Group4 security man and his armoured car. Better that than the banker and his Bentley.

    Cashless transactions are all the rage in banks.

  • rate this

    Comment number 73.

    The M-Pesa system that works throughout Kenya is run by the phone companies and not by the banks. Many more in Kenya have a phone than a bank account. So you can put money on your phone in almost any shop and then transfer it to anyone. Works on ALL phones, not just smartphones. Lose the phone? Call the phone company and cancel the SIM. No links to your bank account so limited risk.

  • rate this

    Comment number 72.

    Oh dear Rory what were you thinking? Why did you not use Contactless payment - NFC (near field communication)? Ever heard of Google Wallet? Well youtube it people! We are lightyears behind the US on this and it doen't help that you are not using the right tech I suggest you re-do this video properly

    Supported retailers:
    Pret a manger

    I've even used it in hotels and bars.

  • rate this

    Comment number 71.

    Sorry to add a rather different perspective to the great celebration of cash going on here, but people shouldn't forget that we all pay for cash in our taxes, it's just that the sums are relatively small compared to the sums going to the big-spending government departments. And on top of that we all pay for the nice people from G4S to move it all around in their expensive armoured vans too...

  • rate this

    Comment number 70.

    @69 "Obviously it's incompatible with Oyster"

    There is a multiplication of systems and methods of avoiding using cash - mostly driven by the companies, not by customers. There is a cost to handling cash born by companies so their desire is to reduce that cost.

    Such a shame it is at the expense of the customers convenience.

  • rate this

    Comment number 69.

    FWIW Oxford buses have their own cashless payment system (the Key), a smart card which can be loaded up with a pass or with groups of 12 journeys. Obviously it's incompatible with Oyster, that would be far too useful.

  • rate this

    Comment number 68.

    @ 47 - John McCormick
    Exactly my friend... you have just been #pin-jacked via wi-fi...

    My advise is... don't put a large amount of 'money' on your phone, you may regret it in time.

  • rate this

    Comment number 67.

    I used to work in the software/I.T. business and that's exactly why I don't use any of these apps, software or online banking. They are all way too easy to break into no matter what the companies tell you. When they are broken into and customer's money/details are stolen the companies are too afraid to admit their systems are bad so you have to fight really hard to get your money back.

  • rate this

    Comment number 66.

    I spent 2 weeks over in Kenya and the majority of the people all use payments made from their phones, its more a security thing rather than carrying cash around with you but it works great, from paying for food, game park entry and even at fuel stations, cash is fine but when its stolen its gone, at least if your phone is stolen you still have your money

  • rate this

    Comment number 65.

    Cash just works. Every time. Always has. Always will.
    It's peer to peer, person to person.

    No centralized, unreliable IT network to get involved.
    No civil servants or supermarket data mining stalking your purchase history.

  • rate this

    Comment number 64.

    So far as I see from Rory's accompanying Video, the phone becomes a front for your credit card (which I assume becomes amusing when you change that over).

    So why not simply make the credit card as easy to use this? I know contactless credit cards exist, why the swap to phones?

    Ah; credit cards don't provide physical tracking; don't require apps which default & don't rig markets

  • rate this

    Comment number 63.

    Hello, #56 AnotherFakeName

    I was being sarcastic. Read the fake name I used to sign the message carefully and you might see I was posing as someone who might like to take advantage of this system.

    Yours sincerely,

    Miss Under-Stood

  • rate this

    Comment number 62.

    I for one don't trust my mobile, because if I add value for it to be nicked, it will be eventually.

    Thanks, but no thanks.

    And the same goes to biometrics, no thanks, a pin or password I can change. My fingerprint... not really, so I will stay away from any sort of biometrics.


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