Egg customers pay by email
Egg customers can now digitally transfer money by email to any of the UK's 110 million bank accounts.
Egg Pay, which will go live later this week, is designed to be a more convenient way to pay small bills of up to £200 than cheques, which the online bank reckons are on their way out.
Cheque usage is down 34 per cent since 1990, and research from Egg and opinion pollsters MORI suggests a third of Britons are interested in digital payment services.
Using Egg Pay, money can be sent to anyone with an email address and a UK bank account; making it more convenient than posting a cheque (which might be lost in the post) or a trip down the bank. Unlike services like PayPal, there's no need for recipients to register for Egg Pay in order to receive their money. Only the Egg customers needs to register, and they don't need to know the recipient's bank details in order to make a transfer.
Here's how it works. An Egg customer would send an email to the recipient and after answering a personal security question set by the sender, the recipient can then accept the transaction.
The funds are then transferred from the customers debit card or Egg account by BACS and are credited to the recipient's account in 3-4 working days. A small interest payment is added on all deposits and payments awaiting collection.
An Egg spokeswoman was careful to point out how it had addressed the security implications in offering the service. The transaction itself is handled on a secure server, and Egg is advising its customers never to send the answer to the security question by email (this is something that needs to be agreed beforehand).
Egg is offering a guarantee to customers that it will refund any monies lost through no fault of their own.
An issue with this sort of scheme is that would-be recipients might be induced to give out their banking details on pirate sites. A spoofed email directing users to email@example.com, might trap to unwary into visiting anyoldnumber.net thinking it was run by Egg, with obvious implications.
Egg assured us that it had thought of this and that it was on constant lookout for potential rogue sites. We've no evidence there are any such sites, but the possibility of such a straightforward scam is something that needs to be guarded against. ®