PhonepayPlus Consults on App-based Mobile Payments

September 25, 2011

According to statements from PhonepayPlus, it has been following developments in the applications (‘apps’) market for some time and has observed that apps are revolutionising the way digital content is consumed and paid for in the UK. While apps have the ability to enrich the lives of millions of consumers and are a growing and important part of the UK’s digital economy, PhonepayPlus sees certain downsides. PhonepayPlus states that it is working closely with many industry providers to understand developments in the apps market – both the opportunities and the threats. It has now published proposed guidance and seeks comment.

PhonepayPlus states:

Our aim with this proposed Guidance is to intervene early to ensure that those downside risks do not have a detrimental impact on consumers, children or, indeed, the many legitimate providers of innovative new digital services.

PhonepayPlus’ new outcomes-based Code of Practice, which came into force on 1 September, is accompanied by Guidance that sets out our likely interpretation of Code rules. Guidance does not form part of the Code and is non-binding on the decisions of PhonepayPlus Tribunals in the event of an investigation which requires them to adjudicate. However, it is likely that providers who have not followed any Guidance relevant to the service under investigation will be invited to explain how they have complied with the Code by other means.

The Code was published in March with 22 pieces of Guidance, and the new Code allows PhonepayPlus to change or add Guidance from time to time, subject to reasonable notice and appropriate consultation. The proposed General Guidance Note on ‘Applications-based payments’ is intended to join the suite of Guidance.’

The 10-week consultation closes on 5 December 2011. Details of how to respond are included in the consultation document.

Responses are sought especially from ‘providers who are likely to be regarded as Level 2 providers (i.e. information providers who are the final link in the premium rate delivery-chain)’ as they are most likely to have to adapt current business processes to ensure compliance.