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O2 Wallet app sends cash like a text, rivals Barclays Pingit

O2 Wallet is a new app for iPhone, iPad, BlackBerry and Android phones and tablets that sends money to friends like a text message.

Put your money away love, O2 has introduced an app that pays for stuff. O2 Wallet is a new app for iPhone, iPad, BlackBerry and Android phones and tablets.

You can use O2 Wallet to transfer up to £500 to any UK mobile number from either a bank account or from a Visa pre-paid credit card that you've topped up with cash.

Just send the specified amount to someone in your address book and they'll receive a text saying their money is in their O2 Wallet app. If they don't have the app, they'll be prompted to download it.

Anyone can sign up and use the service, even if you're not on O2. It's free for the first 6 months, then it's 15p to send money. Receiving cash is free.

The app also dishes out price comparisons, offers and promotions. If you don't want to use your phone, there's an online service as well. And when there's money in your O2 wallet, you can get a special card and withdraw notes from a cash machine for a £1 fee.

O2 Wallet competes with Barclays Pingit, the first big-name mobile money app that saw 20,000 British folk sign up in the first two days. Other rivals include Google Wallet and PayPal.

We've lost track of how long we've been hearing about mobile payments. In fact, we first saw O2 Wallet way, waaayyyy back in 2007. Even now, apps like O2 Wallet and Barclays Pingit, which don't suport NFC, haven't lived up to the full promise of replacing your purse with your phone.

More and more handsets are being fitted with NFC technology, which could see phones paying for things by waving them at a till. Shops haven't embraced mobile payments yet but Visa is pushing for contactless transactions around the Olympics, with the hotly tipped forthcoming Samsung Galaxy S3. Barclaycard has also come up with a way of turning your phone -- or any item -- into a contactless payment doohickey with Barclaycard PayTag, an NFC sticker.

Meanwhile, NFC is finding a use in things like Sony's NFC Tags, which let you change the settings of your phone, depending on where you are, by tapping the phone on a small tag. Here's how to use NFC tags with your Android mobile phone.