UK 4G operator EE is to launch a 'mobile wallet' contactless payment service in partnership with MasterCard using NFC (Near Field Communications).
The technology will be enabled through the 'Cash on Tap' app and will be available from the Google Play app store from 17th July.
The service will be prepaid so users will need to load money onto the app through a MasterCard before making payments.
Consumers will then be able to pay for goods costing up to £20 using their mobile device. As the service is SIM based, it will not be required for the phone to be switched on.
EE has said that the technology can be used in 230,000 outlets across the UK including branches of McDonalds, Boots and Greggs.
More devices are set to be added in the coming months. The iPhone 5 does not currently have NFC built in.
EE is offering £10 free credit to all eligible customers who use 'Cash on Tap'. They will get £5 when they first activate the service and another £5 when they top up for the first time.
The app will be PIN protected and users will be able to monitor payments through their mobile phones.
EE said: "Cash on Tap is the first of our contactless mobile services, but there's loads more in the pipeline. Tickets on tap, loyalty cards on tap... there'll be lots more to tap in the future. Watch this space."
MasterCard competitor Visa, which is working with Vodafone to develop a similar service, has said it believes that 50 per cent of Visa transactions will be conducted through a mobile device by 2020.