Asda and Sainsbury's Partner with Zapp on Groceries Payment with Mobile Phones

From next year, customers in two of the UK's biggest supermarket chains will be able to pay for their groceries using their mobile phones.

Sainsbury's, Asda and 21 other leading UK businesses have partnered with mobile payment giant Zapp in what could be a defining moment in the developing digital economy.

Zapp has closed a series of deals with high profile retailers and also payment providers ahead of a 2015 launch.

The collective customer base of these companies will provide Zapp with 35 million users, and represents the largest-ever show of retailer support for a new UK payment system. Asda and Sainsbury's together represent a third of country's entire supermarket sector.

Fashion retailer House of Fraser and online retailer Shop Direct have also signed up with Zapp.

Banks

In January, Zapp announced that it had signed deals with HSBC, First Direct, Nationwide, Santander and Metro Bank to integrate its mobile payments service with the banks' apps.

Zapp Chief Executive Peter Keenan said: "Today is a hugely significant milestone in the history of money in the UK. At last the promise of a truly mobile and digital payment method will become a reality, meaning easier and more secure checkouts for millions."

Sainsbury's Digital and Technology Director Jon Rudoe said: "We know that the way that our customers shop is changing and we're always looking at new and innovative ways to improve the experience. "

Zapp mobile payments will allow customers to use their smartphone to make purchases both online and at the purchase point of brick-and-mortar shops. The system uses secure digital tokens, designed to protect user data.

The mobile payments market is heating up following the announcement last month of Apple Pay which will take on the likes of PayPal and Square in the increasingly competitive market.

The Centre for Economic and Business Research projects that 20 million adults will use their mobile payments by the end of the decade, with more than £14 billion expected to be spent in 2018.

Who are Zapp's partners?

Retailers:

Asda, Sainsbury's, Shop Direct Group, House of Fraser, Thomas Cook, Clarks, Dune, Spar, Best Western, Bravissimo, Pepperberry, QD Stores, Anglian Water, Bristol & Wessex Water, Oxfam, Charities Aid Foundation

Payment providers:

Verifone, Klarna, Touch Go, Siemens, Apogee International, Vix Technologies, Global Charge, Just Desire, RSL, (previously announced) WorldPay, Elavon, Optimal Payments, SagePay, Realex, Secure Trading, TrustPay Global, Checkout.com

Banks:

HSBC / first direct, Nationwide, Santander, Metro