A vision for payments

Issue 185 | 18 October 2021

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HM Treasury Payments Landscape Review

The HMT payments landscape review has just been published and outlines the government’s vision is for a payments sector at the forefront of technology and innovation.

Underpinning this vision are the government’s high-level aims for payments:

  • UK payments networks that operate for the benefit of end users, including consumers.

  • a UK payments industry that promotes and develops new and existing payments networks.

  • UK payments networks that facilitate competition by permitting open access to participants or potential participants on reasonable commercial terms.

  • UK payment systems that are stable, reliable and efficient.

In order to deliver this vision, the government has identified priority areas and actions for government, regulators and industry.

These are:

  • equipping Faster Payments for the future, supported by a New Payments Architecture that is world leading, and ensuring the right level of protection for consumers to address what happens when a payment goes wrong.

  • unlocking Open Banking enabled payments safely and securely to allow consumers to pay for goods and services in shops and online directly from their accounts, rather than using a debit or credit card, creating competition and choice between payments networks and enabling exciting opportunities for fintechs to build the next generation of payments.

  • enhancing cross-border payments so people and businesses can make and receive cross-border payments seamlessly, quickly and cheaply.

  • future-proofing the legislative and regulatory framework for payments to ensure it is agile and proportionate; promotes and fosters innovation; provides the conditions for technology to continue to drive enhancements in payments; and ensures consumer protection and that payments networks are resilient.


Contactless Limit

In a twitter poll I ran last week, 53% favour a digital wallet over paying contactless - the result is probably reflective of my Twitter profile but a Digital Wallet is such a convenient and friction free way to pay.

Here’s the poll result:

Starling Bank is to let customers set their own contactless limit, noting little demand and a fair degree of concern over the raising of the contactless ceiling to £100 last week.

The benefit of being a digital bank is the ability to listen to customers and implement wanted changes quickly. Analysing our spending data we can see that there appears to be little demand for the increased contactless limit and that many would like to retain the same contactless limit or even reduce it.

CEO Anne Boden

Starling Bank follows Lloyds Bank in giving customers more control over contactless spending, enabling users to set a lower limit from within its banking app. The limit can be decreased from £100 in increments of £10, right down to zero, which will turn off contactless payments completely.


Pay Now

Klarna have announced that it is repositioning its buy now, pay later product range in the UK in response to sustained criticism of its business practices, introducing the ability for consumers to pay in full at the checkout, stronger credit and affordability checks, clear checkout language, simplified T&Cs, improved complaints handling and removal of last remaining late fees.

The Pay Now option brings the UK up to speed with market practices employed by Klarna in over 20 overseas territories, enabling consumers to pay immediately and in full, wherever they see the Klarna button. The move redressed complaints that the app has been designed to lure users into debt and expands Klarna's business beyond pure play BNPL to take on the likes of PayPal and other mobile wallets.


From 4 million to 40 million Open Banking Users

Tim Waterman, Chief Commercial Officer, Zopa argues that awareness of the consumer benefits needs to be improved for the next leg of growth for open banking.

Reports show that we are nearing 4 million open banking customers in the UK. Although this sounds like a large number, should we be patting ourselves on the back? Arguably, not yet.

Since its inception, the goal has always been to bring open banking into the mass market, so as many people as possible can enjoy the benefits of the technology. While progress has been made by several players using open banking to help customers in innovative ways, there is still more that can be done.

By raising awareness and offering the right innovative, truly impactful products, by 2025, around 40 million people could have accessed open banking services and a quarter with some regularity.

This is a bold estimate, and will only be achievable if the industry continues to push forward with innovative, more beneficial uses of open banking that are easily accessible throughout a number of new verticals.

Read Tim’s blog covering delays and opportunities.


GoHenry launches new financial literacy tool for children

Financial literacy is something even some adults struggle with, but children’s debit card goHenry is launching a new tool to tackle it head-on.

GoHenry has today launched ‘Money Missions’, a gamified, interactive tool designed to educate children aged 6-18 and promote better financial literacy.

The fintech has designed games to teach kids about money basics, such as earning, saving, investing, responsible spending and credit money safety.

With 60 million kids and teens in the US and UK alone that have not been adequately served with financial education, Money Missions is one of the ways we are bridging this gap with a hands-on app experience to turn financial education into a motivating, fun, and rewarding way for kids to build confidence with money.

With Money Missions, GoHenry will continue to be the place kids and teens learn the foundational blocks of personal finance and gain real-world money skills necessary for their future.

Alex Zivoder, CEO of GoHenry

Kids will now be able to watch animated videos, take quizzes and earn points and badges while learning about their financial wellbeing.


To The Moon adds debit card to mobile network bundle

Mobile virtual network operator To The Moon has added a debit card to its SIM-only offering, enabling users to manage their network and finance needs in one space.

To the Moon CEO, Andy Hallam says the company's mobile hybrid service is a direct response to the behaviours and needs of its customers, who manage most of their networks, subscriptions and banking services from their mobile devices.

By consolidating the management of an ongoing monthly outgoing - like a mobile contract - with a banking system that sits within the same interface, users will be able to keep better track of their spending, whilst also being able to adjust their flexible mobile data and call plans each month according to their needs.

Moon CEO, Andy Hallam

Available in both GBP and EUR currencies, the virtual debit card can be opened in seconds, without ID, when having a To The Moon Mobile account.


Promoting a UK pound based CBDC

This week saw the launch of the Digital Pound Foundation - an independent body to promote a UK pound based CBDC.

Chaired by Jeremy Wilson, the independent forum is backed by Accenture, CGI Group and Ripple and will push for the implementation of a digital pound and digital money ecosystem.

The Digital Pound Foundation argues that the adoption a CBDC will underpin the UK's transition to an "innovative, inclusive digital economy and society.

Citing BIS research showing that 10% of central banks representing 20% of the world’s population are likely to issue a CBDC for the general public in the next three years, the foundation claims that a digital pound is vital to maintaining the UK's leading position in fintech.

The creation of the forum follows the launch by HM Treasury of a joint taskforce with the Bank of England to explore the case for introducing a Central Bank Digital Currency in the UK.

Last month the BoE and HM Treasury announced the membership their CBDC Engagement and Technology Forums, signing up a host of big names from across the UK's financial services sector.

I'm very encouraged by progress on that [CBDC] front and the fact that we are getting to grips with this critical innovation. If this comes to pass, it will be one of the most fundamental innovations in the history of central banking, it will move us into a new era.

Bank of England governor, Andrew Bailey

The foundation plans to carry out research and advocacy as they push for an inclusive, well-regulated, secure and transparent ecosystem that encompasses both CBDCs and privately-issued forms of digital money.

Technology is transforming human interaction and money must adapt to that. The world has become a global laboratory realising the benefits of a new form of money. The social ramifications of this shift will affect everyone. The Digital Pound Foundation seeks to support the UK in bringing that about for the benefit of all.

Jeremy Wilson


Fraud: a ‘national security threat’…why?

Grab a pastry and found out why from Steve Goddard at Featurespace.

Steve writes:

In March, a bakery owner in South West England received a curious SMS from her bike courier.

The baker, whose canelés are famous in her city, supplies pastries to nearby cafes and other bakeries. She relies on couriers to get fresh pastries to those businesses early in the morning, and the bakery and the courier service have a years-old partnership.

So, it wasn’t surprising that she received an SMS from the courier asking for shipment details. It was surprising, however, when the courier asked for her banking details. That’s when a red flag went up, and the baker called the courier service.

It turns out scammers had spoofed the courier’s phone number and had been requesting bank details from all of their customers. This is known as an authorized push payment scam, and it is one of many types of fraud on the rise in the UK.



  • Financial Crime 360: Are you joining The Payments Association’s newest event, Financial Crime 360? Taking place on Tuesday 9th November at the Royal Lancaster Hotel, London, the event is dedicated to tackling head-on the increasingly complex and rapid rise in money laundering and fraud. Book your place now: https://bit.ly/3v44ZDR

Be more Borg: Assimilate, persistence is futile

In the digital economy, you can become a driver without owning a taxi, a hotelier without owning a hotel, or a bookseller without owning a bookstore.

Without question, Open Banking has escalated the pace of digital disruption of the banking industry. Banks who have invested vast sums of money over many years into critical infrastructure are now mandated to make these systems freely available to their competition who seek to disintermediate them from their customers.

Ian Tomlin at Answer Pay has been exploring how assimilating technology such as Request to Pay from partners makes more sense than persisting to build more infrastructure. 

Ian’s blog covers:

  • The digital platform based business model

  • Platform choices in the financial services industry

  • The need for speed 


In brief

Real-time, financial inclusion and removing friction

Paul Francis Walvik Joynt, Senior Vice President Payments International at Mastercard Payment Services, brings FinextraTV up to date with where we are as an industry in regards to real-time payments.

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