What is Pingit and is it safe to transfer your money by phone?
Will new Barclays app be as 'revolutionary as the credit card' - or will it put your funds at risk?
What is Pingit?
Pingit is a free Barclays smartphone app that promises to make transferring cash as easy as sending a text. It enables money to be transferred instantly using a mobile phone, without the need for users to share sort codes and bank account details.
Customers need a Barclays account and a smartphone, such as an iPhone or Blackberry, and will need to enter their account details and set up a five-digit pin. Recipients do not need to bank with Barclays or own a smartphone but they do need to register for the service.
What can it be used for?
Currently, the service can only be used by individuals rather than businesses, and users can only send up to £300. So it could be used for small payments between friends, such as sharing restaurant bills or paying fees for school trips, or to pay tradesmen, such as window cleaners or plumbers, who cannot receive credit card payments.
Barclays will make the service available to customers of other banks and building societies next month and has plans to expand the service to businesses and charities. Pingit can only be used by over-18s at the moment but the age limit is likely to be lowered in the coming months. Barclays told The Daily Telegraph today that the app "has the potential to be as big a change as the credit card".
How does it differ from PayPal?
PayPal launched an iPhone app in 2010 enabling users to "bump" handsets to exchange funds. Pingit is different because it uses your mobile number as a link rather than your email and can be used on a wider range of phones. As Barclays is not charging anything for the service, commentators have predicted that it is likely to rival PayPal in ecommerce once businesses are able to use it.
How safe is it?
Internet safety experts have warned that the system could provide opportunities for criminals. Tony Neate, from getsafeonline.org, told the BBC that not all online stores verify that downloads are safe, meaning there is a risk of fake apps phishing for customers' bank details. So it is important to ensure the app you download is genuine, he warned.
Barclays has, however, stressed that its system is secure and has been developed with mobile banking security experts. Users can disable the app if their phone is lost or stolen and thieves would not be able to send money without the five-digit PIN. But the bank does recommend that customers enable a general lock on their phone. ·