Get set for the live roll out of Variable Recurring Payments (VRPs)
Issue 283 | 7 March 2022
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NatWest preps for live roll out of variable recurring payments
NatWest is to begin pilot testing of its variable recurring payments product Payit in a live customer environment in the first half of 2022, with plans to scale to a commercial product ready by early 2023.
VRPs allow customers to connect authorised payments providers to their bank account so that they can make payments on the customer’s behalf within agreed parameters. This is a change to the current Open Banking status quo where TPPs can only initiate single immediate payments and customers have to authenticate each payment separately.
It is set to revolutionise the way payments are made online and will look to replace current traditional payment methods such as Direct Debit and Card on File in the future. VRP introduces a mechanism to authorise future payments within pre-agreed limits, meaning consumers can benefit from a new level of payment automation, while experiencing greater transparency and control over their finances.
James Hogson, head of Payit
NatWest has worked on this initiative with Open Banking infrastructure provider TrueLayer.
More: NatWest preps for live roll out of variable recurring payments.
PSR’s acquiring review identifies the right problems, the wrong solutions
Alex Reddish, MD at Tribe Payments, discusses the Payments Systems Regulators recent card acquiring market review, the need to focus on more than cost and how this compares to consumer switching:
We welcome the desire to increase transparency in the market, and the PSR is right to want to make sure merchants have the right deal from the right provider, and that acquirers are serving all parts of the market. But care must be taken to get this right if we want to truly create a better market. Merchants should, after all, be focused on what they do—the payments industry needs to police itself to make sure the best service is available. While it’s important to educate merchants on their options, ultimately we cannot expect them to make decisions about complex products from an industry that should be about outsourcing and solving these problems.
More: PSR’s acquiring review identifies the right problems, the wrong solutions.
Cash 101
Weekly ATM value and volume figures 27 February 2022 the volume of ATM transactions:
increased by 10% when compared to the previous week in 2022.
increased by 16% when compared to the equivalent week in 2021.
decreased by 33% when compared to the equivalent week in 2020.
More: Cash 101.
Pay.UK publishes new strategy document
Pay.UK have published our strategy document ‘Our foundation for the future 2021-2026’. It details their purpose, vision and strategic goals, which they believe will help continue to keep the UK at the forefront of the global payments industry.
The new strategy is designed to provide Pay.UK with the framework they need to deliver what end users (e.g. individuals and businesses), current and future customers (e.g. payment service providers such as banks and building societies), and regulators want: a fast, efficient and well-managed payments platform today, and a next-generation payments platform for the future – the New Payment Architecture (NPA).
More:
Can open banking payment solutions help charities increase fundraising revenue?
Like many organisations, many of the UK’s charities and social enterprises have been hit hard by the pandemic. Nearly two years of on-off lockdowns hit face-to-face fundraising events – a key source of revenue for many charities – and cash donations. Some struggled to retain volunteers, while others faced an increase in demand for their services.
As charities look towards the post-Covid fundraising landscape, OBIE’s new publication ‘The charities guide to growth through open banking’, highlights the opportunities offered by open banking payment solutions.
More:
Unpacking Confirmation of Payee (CoP)
In this Payments:Unpacked podcast we are joined by Paul Simpson from SurePay - Paul helps us unpack the UK's new Confirmation of Payee (CoP) bank account name checking service.
Unpack Confirmation of Payee with Paul as he explains:
Why Confirmation of Payee is so important.
The phased roll out process adopted by the UK.
Considers a non bank use case study.
Outlines SurePay's plans for future development of Confirmation of Payee.
Explains why a 'partial match' and a 'no match' are just important as a 'match'.
For more make sure you visit SurePay's website.
Implementing Confirmation of Payee (CoP)
NatWest is one of the nine largest banks in the UK as determined by the Competition and Markets Authority, and part of this CMA 9, it has been at the forefront of developing a Confirmation of Payee service for its customers.
Given the bank’s central role in the country’s financial infrastructure – NatWest currently handles one out of four digital payments in the UK – getting it right the first time is crucial.
After a thorough procurement process, SurePay was selected as the bank’s CoP partner. A critical factor in SurePay’s selection was its successful rollout of a similar service in the Netherlands four years ago. SurePay’s Dutch banking and corporate customers integrated the solution and saw a step change in fraud prevention in the payments space. Of particular interest to NatWest in its decision-making process was that Dutch adopters reported an 81% drop in fraudulent payments and a 67% drop in misdirected payments.
Critically, SurePay has improved the system through the pioneering use of algorithms to check and track payments. It was that aspect, among several others, that convinced NatWest that working with partners like SurePay offered a way forward into a future of further digital disruption.
We selected SurePay to support our delivery of CoP, because of their experience in the Dutch market and excellent understanding of complex name matching issues.
NatWest
Prioritising fraud prevention and New Payments Architecture
The payments segment is frequently and rapidly changing, from growing fraud prevalence, to the proposed New Payments Architecture, all within a dynamic and innovation-driven landscape. Financial Director have been speaking to Myles Stephenson, CEO of Modulr and Mark Hoban, Chair of Pay.UK, about the trends, and future of payments.
Mark Hoban and Myles Stephenson discuss:
Fraud identification and prevention (00’19)
NPA (3’38) - including a reference to POS A2A displacing cards (with a reference to Mastercard).
UK’s regulatory landscape (5’57)
Competition and innovation (7’50)
Future of payments (9’00).
Video: Payments segment prioritising fraud prevention and New Payments Architecture.
Imagine the possibilities
Canada’s new payment systems will support ISO 20022 providing significant benefits for businesses.
Payments Canada have been imaging the possibilities ISO20022 messaging will provide regarding more data with each transaction and creating more opportunities for innovation in the payments industry - video:
New Payments Platform Australia
Australia’s New Payments Platform report that PayID registrations reported to have hit 10 million.
It’s no wonder that more and more people are choosing to use a PayID instead of BSB and account number with:
Fewer mistakes – see who you’re paying, before you pay
It’s simple – easier to remember than a BSB and account number
It’s secure – it works within your internet or mobile banking
It’s flexible – can be moved between accounts and banks
It’s fast – payments happen instantly.
To see PayID in action, visit: https://lnkd.in/gTJAknQz
China's SWIFT 'equivalent'
CIPS or the Cross-Border Interbank Payment System, seen as the Chinese equivalent of the globally-used SWIFT, or Society for Worldwide Interbank Financial Telecommunication, has become a buzz word in the domestic capital market and related industries.
Background reading: CIPS
Shopping without cash in 1966
A “strange first” in British bank advertising history - here’s how the Martins Bank Archive describes the advert for Barclaycard which helps you buy “almost anything”:
This advert represents a strange "first" in British bank advertising history - although desperate to express their individuality and advertise on TV, British banks were tied by a gentleman's agreement to only issue bland joint statements on policy.
In 1966 Barclays were able to break the agreement in a rather ingenious way. They advertised BARCLAYCARD, a subsidiary company product, in Scotland, for customers of the British Linen Bank, another Barclays subsidiary company!
Video: Shopping without cash in 1966.
88 million subscription boxes
With 88 million subscription boxes delivered in 2020, it is vital that businesses consider moving with the subscription trend. Implementing a recurring business model can entice customers and keep your business ahead of the competition. Access Paysuite have looked into the benefits of a subscription-based payments model and how to make it work for your business:
More: http://ow.ly/zm5350HNHaO
ICYMI
Stopping APP fraud
More: How To Avoid Online Shopping Scams That Are All Over Facebook
In brief
Africa's first mobile payment service, M-Pesa, is celebrating its 15th anniversary, having grown to connect 51 million customers and 465,000 businesses across seven countries.
Fed preps tiered system for evaluating fintech access to services.
PollenPay is the latest startup to enter Britain's already crowded buy now, pay later arena, which has just witnessed its latest casualty in the withdrawal of Openpay from the UK market.
UK Fintech Modulr Raises Faster Payments Limit to £1M for Customers, As Default
Payments Regulation: What is up ahead in 2022?
The regulatory pressure on payments firms continues to grow year-on-year. In 2022, we can expect to see a particular focus on some key areas such as customer communications, Anti-money laundering protocols, SMRC, Operational resilience, governance and control measures and Safeguarding regulations.
Until now it has been relatively easy for EMIs to operate with elementary governance and control measures to safeguard customer funds, often relying on basic, manual processes. However, as the industry comes under greater scrutiny, regulators will expect more strict and transparent plans and controls in place to segregate customer funds more effectively.
Safeguarding is a fundamental process to mitigate consumer risk, and recent cases such as Premier FX have brought to life how important this is. As such, the FCA have every reason to further develop these regulations and encourage EMIs to strengthen their middle and back-office systems to ensure timely, accurate and transparent segregation of client funds.
The basic Safeguarding, governance and control strategies firms currently have in place will certainly fall short as the payments industry continues to expand and consumers adopt its digital payment methods.
Join the Payments Association Insights webinar to learn how other firms are anticipating the future of regulations for EMIS and to gain key insights from our expert speaker line-up on how your organisation can ensure compliance.
More: Join me for a fireside chat with Nick Botha from AutoRek on March 31st.
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