The UK operator has partnered with Visa, and the capability will work with a SIM card embedded with NFC technology.
Analysts says the move could directly compete with Apple’s plan for mobile payments, and the capability will also allow for swiping at contactless tills.
Vodafone will open up the technology to banks to use the payment service, and it will be developed to be used for travel on the underground, in addition to allow for P2P payments between its subscribers. It will launch the service later this year.
“The pieces are falling into place,” said Alix Pryde, head of innovation at Vodafone UK. “There are now the devices, the contactless payments and increasingly the consumer behaviour to make this a success.”
Vodafone has already launched similar services in European markets, including Italy, Germany, Spain and the Netherlands.
Over 300,000 Vodafone terminals have been enabled so far by Visa contactless payments, representing a 67% increase from last year.
Apple is also reportedly set to launch a range of payment-compatible devices later this week, as part of plans to integrate mobile and financial services.
