The nation's biggest mobile phone operators have clubbed together to develop technology that will turn your mobile phone into your wallet, travel card and front-door key.
Vodafone, O2, Orange and T-Mobile announced plans on Thursday for a joint venture that would allow shoppers to pay for goods and services with their phones rather than cash or cards.
Consumers will be able to pay for sandwiches, drinks and train tickets by placing their phones close to a reader similar to the Oyster card system on the London Underground. In the future the technology might even allow you to unlock your front door and start your car.
Guy Laurence, chief executive of Vodafone UK, said the technology would enable "everyone to put their whole life in their pocket on one device".
"The mobile has become the one item people really cannot be without," he said. "In the near future, people will start leaving their wallets at home ... and in the mid-term, access to cars and homes will be built into phones."
Tom Alexander, chief executive of Everything Everywhere, which owns Orange and T-Mobile, said the new system would allow consumers to "manage their money and make payments using their handsets, helping advertisers reach their customers on the move, and helping banks provide their clients with an easy and convenient way of making payments".
The "wave-and-pay" technology, called near-field communication (NFC), has proved popular in the Japan and South Korea, but has so far failed to make an impact in Europe.
The fiercely competitive operators said working together was the only way to bring the technology to the masses and encourage mobile phone manufacturers to include it in their forthcoming models.
Ronan Dunne, chief executive of O2 UK, said: "The mobile marketing and payments market is extremely fragmented. By creating this new business we will underpin this nascent market, providing real size and scale."
Kevin Russell, chief executive of 3, the UK's smallest operator, hit out at his larger rivals for leaving 3 out of the project. "We would want and expect to be a part at the heart of a cross-industry development like this and are more than a little concerned that, as a core competitor, we have not yet been invited to be part of this joint venture," he said.
Vodafone, O2 and Everything Everywhere said the service would be open to all retailers, banks, ticketing companies, advertisers and other mobile companies, including 3, Tesco and Virgin Mobile.
The trio said they would inject significant capital into the project and would each own one third of the equity. The service is expected to go live early next year, subject to regulatory clearance.
IE Market Research says NFC payments will account for a third of the £700bn global market for mobile payments by 2014.
