Now you can give your customers even more choice about how they pay by offering account-to-account payments, enabled by open banking.
Paying for goods and services by bank transfer has traditionally been a more time-consuming and manual process than paying by card. But bank transfers have become fast and seamless—for customers and merchants alike—thanks to recent changes in banking regulation.
Open banking (a requirement of PSD2, the revised European Payment Services Directive) uses standardized APIs to connect banks with third-party providers and enable the instant transfer of money from customer to merchant at the point of purchase. The U.K.'s Open Banking Implementation Entity (OBIE) reports that 3.9 million consumers and 600,000 small businesses already use open banking.1
How do customers benefit?
More choice. When you offer account-to-account payments, you give your customers yet another way to buy from you.
More control and flexibility. Because customers are paying directly from their bank account, they can easily check their balance and make more informed purchasing decisions. And a customer who wants to spread out the cost of, say, a utility bill can make smaller, more frequent payments up to the due date. It's a flexible alternative to a fixed direct debit that gives customers more control.
Frictionless experience. Customers can enjoy a convenient, effortless alternative to card payments. With just a few taps, they can pay online without having to enter card or bank account details.
Security. Account-to-account payments are authenticated within a mobile banking app, so customers can be confident they are secure. And confirmation of the payee lets customers know exactly where their money is going, which reduces the risk of fraud.
What's in it for merchants?
Meet customers' expectations. When you add account-to-account payments, you provide customers with choice and flexibility, which can reduce the chances of cart abandonment and improve payment experiences.
Rapid settlement. Account-to-account payments are settled quickly, usually within a few seconds. Refunds are also instant.
Lower transaction fees. Account-to-account payments can be cost effective for merchants as they generally avoid the typical transaction costs.
No chargebacks. There are no chargebacks because account-to-account payments are authenticated directly between customers and banks.
SCA support. Account-to-account payments support SCA requirements without compromising customers’ checkout experience.