Forget cheques or credits cards, you can soon make your day-to-day payments through your mobile phone.
Britain’s recent decision to phase out cheques by 2018 has led to the development of new secure payments technology in the University of Oxford that allows people to make payments via mobile phone.
The new security technology developed by Professor Bill Roscoe and his team is designed to work in almost all situations: person to person, in a shop or restaurant, at a vending machine, online, or as part of a telephone conversation.
The U.K. payments Council has announced that as part of efforts to put in place more efficient ways of making payments, no cheques will be issued or honoured in Britain from October 2018.
The council, which represents financial institutions, voted to end the 350-year-old system of paying by cheque, which it said, was in “long-term, terminal decline.”
The council’s chief executive Paul Smee said: “There are many more efficient ways of making payments than by paper in the 21st century, and the time is ripe for the economy as a whole to reap the benefits of its replacement.”
Professor Roscoe said: “A key requirement of new payment systems will be the ability to make payments from person to person, such as paying a builder or a friend.”
“What we have is technology which enables anyone to easily create a secure connection between two devices: it can work via Bluetooth, WiFi, the internet or across ordinary telephone or SMS connections,” Mr. Roscoe said.
He added: “The core of our technology is a new security protocol that enables strong cryptographic keys to be created with the least possible work. The key to the protocol is that it prevents anyone from doing any searching to break into the transaction.”
The Oxford technology uses a system in which the payer checks whether a short numeric code (4-8 digits for most applications) generated within their own phone is the same as the one generated by the payee.
This number is random and does not have to be kept secret.
This ensures that the customer’s mobile is connected to the correct store, or to the mobile of the person they wish to pay.
Payment then occurs without the exchange of sensitive details such as credit card numbers or PIN numbers.
It is expected that no hardware modifications to the phones will be needed, and the Oxford team have built demonstration systems to show a variety of uses.
The payment itself could be made in a number of ways: using electronic cash or credit stored on a mobile phone, via authorisation of a credit card payment, or by instructing a bank to pay a merchant or another person a certain amount.
Professor Roscoe said: “The technology is designed to put the payer in charge of the connection and let him or her have direct control over how much is paid and to whom — very much like a cheque.”
