The Barclays Pingit mobile payment system, which can be seen as a rival to PayPal, has been extended to all businesses, not just sole traders.

Thousands of small businesses are already benefiting from faster payments by using Barclays Pingit, which allows firms to easily and rapidly make and receive payments via a mobile phone number.

Barclays has extended the service, launched this February, to enable all of its business customers to send and receive payments. Business customers of other UK banks can register to receive payments only. In response to demand, limits have also been changed for business users, allowing unlimited payments to be received (previously capped at £5,000 per day).

Over 5,700 small businesses have already registered for Pingit as an alternative to cash, cards, cheques and online transfers.

Sue Hayes, managing director for business banking at Barclays, said: “Small business owners lose time and money chasing late payments, but Barclays Pingit is revolutionising the way they can do business."

Mehmet Bekir, owner of building company MPBS, said: “Barclays Pingit is the most useful app I have ever used. I can send and receive money at the touch of a button using just my mobile phone, making my business far more efficient. I’m not waiting for cheques to clear and I can pay suppliers and be paid by customers in a matter of seconds."

Barclays Pingit is also now available to Barclays Corporate banking clients, allowing them to receive payments from their customers. Businesses can register for a unique corporate ID or Quick Response (QR) code which is linked to a corporate current account held with Barclays.

The new corporate collections functionality will provide customers with an easy and convenient way to pay their bills simply using their mobile phone. Companies are expected to sign up for this service as demand from customers increases, said Barclays.

PayPal allows registered users to make payments over the internet by simply using an email address linked to their banking details. Pingit allows users to make payments using their mobile number linked to their current account.

Both systems enable two parties to transfer and receive cash without having to share their banking details. PayPal has become popular with many online merchants to do business, knowing that online purchasers often don't want to share their bank account numbers.

Pingit could potentially rival PayPal in ecommerce as merchants can set up a mobile number linked to their trading account, which would enable them to avoid fees for receiving cash, although Barclays said "normal transaction charges may apply for business customers".