Telefonica’s UK mobile operation, O2, has pushed into the financial services space, teaming up with bank NatWest to launch a prepaid debit card.

James Middleton

July 16, 2009

2 Min Read
O2 breaks into financial services with cash card launch
O2 breaks into financial services market

Telefonica’s UK mobile operation, O2, has pushed into the financial services space, teaming up with bank NatWest to launch a prepaid debit card.

The first fee free, prepaid Visa cards will be available to O2 contract and prepay users by mid-August, and are designed to help people manage their spending money by doing away with overdrafts and providing real time balance updates to the mobile.

The card can be used almost anywhere that accepts Visa within the UK and abroad, as well as online. The card can also be used to withdraw cash from an ATM. A version of the service for kids aged 13 and over also means the card cannot be used at various web locations, such as online gambling sites.

Ronan Dunne, O2 UK’s chief executive, said the move fits in with the company’s strategy of the ‘mobile wallet’. “We believe that we are at the start of a journey towards the coming together of phone and wallet and we intend, through O2 Money, to be at the forefront of this trend. This launch represents an important step towards O2 becoming a leading service provider with mobile at its core.”

Last year, O2 carried out a six month study focusing on consumer acceptance of near field communications (NFC), which came out strongly in favour of the contactless technology.

The O2 Wallet trial took place over six months between November 2007 and May 2008 and involved 500 triallists. It tested consumer demand for having cards you would normally carry in a wallet, such as Oyster and credit cards, available on a Nokia 6131 NFC mobile phone.

To travel on London’s transport system or make purchases in retail stores, the user touched the phone against a reader. The trial involved a range of firms including O2, Transport for London, Barclaycard, Visa Europe, TranSys, Nokia and AEG.

Nine out of ten triallists were happy using NFC technology on a mobile phone says O2 and 78 per cent said they would be interested in using contactless services if available. Convenience, ease-of-use and the status of having such an innovative device were seen as the main benefits.

According to the study interest in having Oyster on their mobile phones was particularly strong with 89 per cent of triallists saying they were interested in taking this up. Over two-thirds of triallists also said that they would be interested in having the Barclaycard Visa payWave feature on their mobile in the future.

About the Author(s)

James Middleton

James Middleton is managing editor of telecoms.com | Follow him @telecomsjames

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