O2 will be launching a mobile wallet app in the second half of 2011, the company has confirmed.
According to a report on PCR, the network operator has announced its intention to apply for an e-money operating licence from the FSA.
The mobile wallet app will include support for NFC (Near Field Communications) technology, and enable O2 customers to use their smartphones to make contactless payments, effectively replacing their credit card with their sim card.
Smartphones such as Google’s Nexus S come with NFC built-in, and the iPhone 5 is expected to carry the technology.
The wallet app will also facilitate person-to-person money transfers, alongside other financial services.
Everything Everywhere (Orange and T-Mobile) has already announced its own mobile payment scheme, which will be launched later this year in partnership with Barclaycard.