UK Finance sets out new open banking payments strategy

UK Finance has outlined new recommendations for the future strategy of open banking payments.

A new report published by the banking body highlighted that there are now over 2.5 million open banking payments a month, compared to just 320,000 in the whole of 2018.

The recommendations in the report are expected to help support the development of more products and services for consumers, UK Finance stated.

The report has called for further development of open banking payment standards, supported by industry governance and an associated technical group. UK Finance said this should be considered following the CMA’s decision on open banking governance and a successor body to the Open Banking Implementation Entity.

UK Finance also suggested there is a case for exploring a voluntary framework for open banking payments – without which there could be fragmentation in the market. The report highlighted roles, responsibilities and liabilities of different market participants which could be described in such a framework.

There is also a growing use of open banking payments for e-commerce, and UK Finance added that the development of variable recurring payments (VRP) offers the potential to extend open banking to subscription payments in the future. According to the report, this would give customers more choice about how they pay and an alternative to card-based payments, offering more competition in the market.

UK Finance managing director of payments and innovation, Jana Mackintosh, commented: “The shared vision for open banking payments is to offer customers and merchants a greater choice in how payments are made and received.

“Open banking has an exciting future, and the payments industry is working together to consider how the market could be enhanced for customers and merchants.”

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