Barclaycard unveils mobile paytag

Millions of Barclaycard Visa credit card customers will be able to make "contactless" payments using a sticker attached to the back of their mobile phone which can be held against a reader.

The free Barclaycard PayTag can be fixed to the back of any mobile phone and is around a third of the size of a normal card.

The phone can then be used to make payments of £15 and under, rising to £20 in June, by being held over a payment terminal, without the need to sign or enter a PIN.

Concerns have been raised about the security of contactless bank cards, after a recent investigation suggested that people could have their details taken from a card in their pocket or wallet without their knowledge.

Channel 4 News found last month that new mobile phones could be adapted to take information from Barclays-issued Visa cards with one swipe.

Barclays told the programme that the issue is not with contactless cards, but with checks undertaken by some retailers, saying the details obtained should not be sufficient to undertake fraudulent activity.

Those behind the new Barclaycard scheme insisted it is "safe and secure" and emphasised that it comes with "the same 100% fraud protection as any Barclaycard".

There are more than 14 million contactless-enabled Barclaycards and Barclays debit cards and Visa predicts that the number of contactless point-of-sale terminals in the UK will rise by 50% to 150,000 this year.

Major retailers which offer, or are introducing, contactless payments include Waitrose, McDonald's, Boots, WH Smith and Tesco.

Barclaycard plans to roll out the scheme to customers later this year, saying that it will reach "millions" of customers. It did not give an exact figure for how many people it expects to take up the scheme but said hundreds of thousands of customers will be offered the chance to take part in the coming weeks.

Louise Holmes, spokeswoman for comparison website Moneyfacts, described the scheme as "an exciting, innovative way for cardholders to conduct transactions".

She said: "Millions of us carry mobile phones nowadays, so using our phones as a method of payment should prove popular with many consumers."

PA