The system will use mobile headsets for authorization: the customer has to enter his mobile phone number into a merchant's website. He then receives a SMS-message with a unique PIN for this specific transaction. After entering the PIN successfully the specified amount (up to 10 Euro per transaction) will be charged to the regular phone bill.
What makes Handypay so interesting is the fact that nearly all German mobile phone companies have already agreed to support it. The carriers will take care of credit assessment and the handling of payments - so people don't have to register with Handypay to use the service.
According to the press release, Handypay will launch in November with 120 German ecommerce-sites.
Unfortunately, the available information doesn't say anything about the minimum amount which will be possible to be charged or the fees that merchants will have to pay for offering this payment-method.