­The UK’s Payments Council has approved plans to enable payments by mobile phone simply by sending a text message. The users will however have to preregister their details with their banks to set-up the service.

The service is due to go live in early 2014 and will be supported by UK banks covering about 90% of UK banking customers.

The new service will enable secure payments to be made directly to or from an account without the need to disclose the sort code and account number, by simply using a mobile phone number as a proxy.

While there are existing ways to pay using a mobile, the collaborative Payments Council project marks the first service with the potential to link up every bank account in the country with a mobile number.

Shortly before launch, participating financial institutions will invite customers to register via their online banking service, mobile app or other approved method to provide their mobile phone number and confirm which account they want to link it to. More details about the industry-wide registration process and precise launch date will be announced in due course.

Over 5,000 consumers participated in Payments Council research which revealed that the service is likely to prove most popular with smartphone users, who accounted for two thirds (67%) of those surveyed. One in three smartphone users said they were either definitely or extremely likely to sign up to the new service at launch.

The consumer research also highlighted the importance of the security of mobile payments. The Payments Council service will ensure that, as a minimum, a passcode or similar security feature will be required to authorise payments. The service will also offer the technical capacity for financial institutions to remotely disable an account in case of suspected misuse. Beyond these common features providers will be free to innovate and customise exactly how they offer the service to customers.

The new mobile payments service will move money directly between accounts using tried and tested payment schemes: the Faster Payments service, which processed more than 800 million online and phone banking payments in 2012; and the LINK network, which processed 3.1 billion real-time ATM transactions last year.

Over the next year, the Payments Council’s delivery programme is continuing the work needed to set rules defining minimum service standards for security, speed and other technical requirements. This includes comprehensive end-to-end testing, preparing and implementing the pre-launch registration campaign and speaking with other interested financial institutions to ensure the service is made available to the highest possible number of customers.

This final phase of the mobile payments project follows the on-time completion in December 2012 of the central database that enables banks to securely store their customers’ mobile phone numbers and link them to their account details. The Payments Council will also continue to test and enhance the capacity of the central database and work with the participating financial institutions to ensure the operation of the service is as easy as possible for customers.