O2 has launched Wallet, its service for making payments with a smartphone.

O2 Wallet allows users to send a 'Money Message' of up to £500 with a mobile phone number, among other things. The service doesn't require near-field communications (NFC) technology or for users to be O2 customers.

James Le Brocq, managing director at O2 Money said: "O2 Wallet delivers the benefits of mobile money to more UK consumers than any other product or service currently available. With O2 Wallet, it’s easier to transfer money, track expenditure and pay swiftly and securely, all using your mobile. We believe it will transform the way people manage their finances and spend money."

The shopping section of the app offers price comparison with barcode scanning and discount deals. O2 touts Wallet as a virtual debit card for making online purchases and users can also apply for a physical O2 Money Account Card for high street payments or ATM withdrawals.

O2 Wallet is available in app form for Android and Blackberry smartphones as well as Apple's iPhone and iPad. The app is free for the first six months after which O2 will introduce various fees such as 15p per Money Message.  

Security is not an issue which O2 has bypassed with Wallet with months of 'extensive' in-house testing. Le Brocq said: "In additional to PINs and passwords, all personal details and financial data are held on remote central servers rather than on the mobile device itself. This, we believe, is the safest and most secure way to deliver mobile payment services."

The mobile operator said the O2 Wallet will be developed further adding the ability top-up mobile airtime and purchase train tickets.