Security is certainly a concern for the public when making mobile payments. A survey by eDigitalResearch earlier this year found that over 50 percent of the 2,000 people surveyed identified security issues as a major disincentive to using remote payment methods. Some 40 percent said the possibility of fraud was a major concern regarding mobile payments.
However, Daniel Lucht, director at Research Farm, which publishes reports on the mobile payment sector, cast doubts on consumer take-up of the PayPal scheme.
"There are wide-spread data privacy concerns in Europe — and the U.K. especially — and so I don't think people will like shopping with their photos," he told CNBC on Thursday. "The app might be a bit too familiar, and freak people out."
Lucht added that generally, U.S. consumers were much more amenable to this level of familiarity, which was why similar payment systems had taken off in the U.S.
He identified Starbucks as the "biggest player out there" in terms of mobile payment, and said the coffee chain's app was especially popular because they had related it to their loyalty offers.
"PayPal should look at linking their app to loyalty points or offers, instead of focusing on photos," he said.
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Rob Harper, head of retail services at the PayPal, said the photo verification had gone down well with retailers in the trial, as it brought a more personal element to mobile payment.
"This is another step on the journey towards a wallet-less high street, where customers will be able to leave their wallet or purse at home and pay using their phone or tablet," he said. "We predict that by 2016 this will become a reality."
The company, which is owned by eBay, has already rolled out the new system, called "check in to pay", in the U.S. and Australia. It now hopes to have it available in 2,000 U.K. locations by the end of 2013. A PayPal spokesperson confirmed that retail brands including Oasis, Coast, Karen Millen and Warehouse planned to sign up to the scheme.