UK retail bank Barclays is launching an alternative service for companies needing to send out payments to individuals, via the use of mobile phones.

The bank says the target market is insurers, retailers and utility companies. The new service called Send a Payment is part of Barclays’ Pingit app.

Sending a payment to a customer’s mobile phone saves costs, claims the bank.

The new service follows news last week that mobile banking take-up among customers is contributing to 1,700 job losses from customer-facing staff in Barclays’ branches.

In a statement, Barclays said: “The way in which our customers access their banking services is changing rapidly. More and more people are choosing to use smartphones and technology for everyday transactions, using branches only when they need access to expertise.”

In response, the bank is investing in the newer channels that customers actually use, which means retraining staff but having fewer in its physical branches. The redundancy programme is voluntary and will be introduced during 2014.

According to the bank, customers want new services such as Send a Payment, which enables corporate customers to send money using an individual’s mobile number instead of needing bank account or card details.

The service is open to any UK user with a mobile number including Barclays and non-Barclays customers. Non-Pingit users are asked to register for the app in order to receive their money.

The bank claims the new service provides a way for companies to reduce physical and environmental costs over cash handling, cheque production and issuing costs, without needing to handle sensitive account information from users.