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Any news on how banks plan to make up the £200M loss of revenues caused by this change?

You can have your mobile wallet and lose it too:

The Clear And Present Danger With NFC Payments

There's no such risk with a physical wallet.

I was almost sold on Email OTP until I saw the analogy with eStatements: How Suitable Is Email For Delivering Bills And Statements? Do you have to supply a password before seeing the OTP?

Agreed but I'd anyday accept the predictable "pain in the pocket" over the unpredictability of the smartphone / mobile OTP alternative. But, that's only me. As I said, "Only time will tell whether Mobile OTP will stimulate online payments or sound its death knell."  

Not having to take it out of a wallet is a major appeal of contactless cards for me. Take that away, it almost turns into a damp squib. That said, chip-and-PIN involves the huge friction caused by password, so the difference between contactless-taken-out-of-wallet and chip-and-PIN is more than just the few extra seconds. Until something comes along in between, I'm happy with only one contactless-card-that-stays-inside-my-wallet.

@RiteshA: TY for bringing up the alternative of Email OTP. While I've no personal experience with it - none of the close to a dozen-odd banks I'm exposed to uses it - Email OTP seems more convenient than Mobile OTP. However, Email OTP is "in band" and, for that reason, could be viewed by security purists as less secure than Mobile OTP, which is "out of band". 

@AlexP: TY for your comment. The same bank has been using hardware tokens for supplying OTPs for a different usage scenario (NetBanking) for several years. In 8+ years, I've never had a problem with it (knock on wood!). I guess it has moved away from a hardware alternative for online credit card usage due to a myopic focus on cost reduction. 

Wikipedia and other Top 3 Google SERP results call "BitCoin" a currency. No one calls oranges currency, besides they're perishable and anyway don't meet the durability prerequisite for a currency. M-PESA is clearly not a currency, it's a method of payment that is used to transfer the regular local currency (KES, Kenyan Shilling). That said, that there could be a rigorous definition of the term "currency" that BitCoin doesn't fulfill, but that doesn't reduce its appeal in the limited context I've described.

Loyalty to old business processes is not unique to BFSI. However, vendors serving manufacturing, retail and most other industries - e.g. ERP - are lot more successful in persuading their customers to replace old practices than fintech vendors are, with their BFSI customers. Maybe BFSI is very different from other industries but, in my exposure to other industries, I suspect the problem lies more with the deficit in consulting skills in the fintech vendor community than anything else.

1 US$ held in PayPal or Google Wallet or leather wallet and tranferred by CHAPS or FPS or pigeon is always worth US$ 1. However, 1 BitCoin is worth wildly differing amounts of US$ from one day to another. Therefore, it seems to me that BitCoin is as much a currency as JPY or INR or AED. Just to clarify, in the limited use cases of T&E reimbursement and others mentioned by me, I'm ultimately happy to keep my BitCoin as BitCoin. If the parallel system goes bust, I don't mind seeing my BitCoin proving worthless. On the other hand, if the primary system becomes shaky - remember Cypress - my BitCoin might prove to be a multibagger some day. That's the calculated risk I'm willing to take.

If there are simple and effective ways to mitigate CC fraud, none of the banks I bank with seems to be aware of them. All I've been getting from them are CVV, then VbV, now Mobile OTP. With phone trees and long hold times, banks have made it very painful to contact them if my transaction goes wrong. Against this backdrop, I'd give BitCoin a decent chance for transactions with low-to-medium ticket sizes. While on the subject, one great use case I came across for BitCoin is the introduction of a new feature by a leading T&E solutions provider for settling T&E claims with BitCoin. Having already spent the money, many people - me included - treat reimbursement as "funny money" and don't mind taking a gamble on its true worth. With its innate nature of being a currency having a fluctuating value, BitCoin panders to this behavior very well.