O2 calls time on mobile payments service after 18 months

O2 has confirmed the imminent closure of its mobile payments service, just 18 months after launch.

O2 Wallet will shut down on 31 March 2014, with the mobile operator citing changing market and customer demands as factors in its demise.

"When we launched the O2 Wallet 18 months ago, we were one of the first mobile wallets around. Since then lots has changed for us, the market and our customers," the company said in a blog post.

"So, we've decided to close the O2 Wallet to give us time to look into new and better ways to help people manage their money on the move, both in the UK and abroad."

The service was launched in April 2012 and allowed users to transfer sums of money to any person in possession of a UK mobile number, and pay for goods.

It also gave users access to physical and virtual account cards, known as O2 Money Account Cards. Users could pre-load sums of money onto these to pay for goods and services, and reduce the risk of them overspending.

This aspect of the service will also shut down at the end of March.

"After the 31st of March you won't be able to use your O2 Wallet or O2 Money Account Card anymore that includes sending or receiving Money Messages, using the O2 Wallet or card to shop, buy train tickets in the app or top up your mobile," the blog post reiterated.

Any users that still have money in their O2 Wallet accounts should either transfer or spend it before the switch-off date. Alternatively, O2 has offered to return the remaining sums to the bank accounts people registered with their accounts or send them a cheque.

The decision to terminate the service has been linked to the emergence of Weve, a mobile payment and loyalty points initiative EE, O2 and Vodafone threw their weight behind last year.

The service allows businesses to draw on the reach of the three networks to deliver targeted advertising, and enable mobile wallet services.