Smartphone payments app gets banks" backing A smartphone app allowing shoppers to pay for purchases direct from a linked account will be made available to 18m UK bank customers this year - in the latest sign that the banks are gearing up for rapid adoption of mobile payment systems. Known as Zapp, the app is due to launch between September and October and will be available to account holders with five UK banks: HSBC, First Direct, Nationwide, Santander and Metro Bank. Together, they hold 35 per cent of all current accounts in the UK. Zapp has been developed by Vocalink, the group that runs the UK's payments infrastructure, and which is owned by a consortium of 18 banks and building societies. Vocalink has so far pumped £33m into producing the app. Initially, the mobile payment system will only work for online purchases, but Vocalink expects it to be enabled for in-store transactions in late 2015 - cutting out the need for credit cards both online and on the high street. "We are literally building, from the ground up, a whole new payments ecosystem," said Peter Keenan, Zapp's chief executive. He likened the effort to the creation of SWIFT, an industry standard for sharing information about financial transactions developed from the 1970s. Zapp is one of a several mobile payment systems competing for a share of the mobile payment market, which research firm Gartner estimates will be worth $721bn by 2017. Technology groups, telecoms companies, e-commerce groups and credit card providers are each trying to exploit their particular strengths to appeal to consumers and retailers alike. Both Google and Visa now offer digital wallets, while Vodafone, EE and Spain's Telefónica have teamed up to launch Weve, a payments and marketing platform based on phone numbers. For banks, Zapp represents an opportunity rebuild their reputations after the financial crisis and foster relationships with their customers, said Mr Keenan. However, some appear to be hedging their bets, with four of Zapp's partners signing up to a parallel scheme organised by the bank-run Payments Council that will let people send money to one another using mobile phone numbers, due to launch this spring. Barclays, which has not signed up to Zapp, has its own payments service known as Pingit. But Tony Prestedge, chief operating officer of Nationwide, said the competitive advantage of such standalone products is likely to erode in the longer-term, as co-operative schemes, like Zapp, make the technology ubiquitous. "I see it as a ticket to the game to be a credible current account provider in the UK," Mr Prestedge argued. Zapp's technology works by generating a secure token that authorises a payment directly from a shopper's current account to the merchant. Users of the initial version of the app can visit an e-commerce website on a mobile device, and will then be offered the option of paying via Zapp, before being returned to the site. By cutting out the need for credit cards, Zapp hopes to capitalise on customer concerns about fraud and identity theft. In December, Target admitted that cyber criminals had stolen the credit card details of up to 40m of its customers. Zapp is enabled for use with retailers that handle 60 per cent of UK transactions by volume, thanks to partnerships with payment processing companies including WorldPay and Sage Pay. Some analysts questioned the usability of the launch version, though. "People don't want to jump from website to website, app to app, to complete a transaction," said Sandy Shen, an analyst at technology research company Gartner. They want to complete a transaction in a few clicks. You have to balance the security with the convenience and the user experience.