By Oliver Smith on Wednesday 4 May 2022
The first UK bank to go beyond the CMA order.
High street bank NatWest has become the first UK bank to offer variable recurring payments (VRPs) as a recurring payment option through a partnership with three open banking providers today.
TrueLayer, GoCardless and Crezco are all part of the agreement with NatWest to go beyond what the CMA order requires—to introduce ‘sweeping’ between accounts—and offer VRP as a full-on payment option.
The agreement means that businesses will be able to start offering VRP as an alternative to direct debit payments, letting consumers consent to regular payments via the Faster Payments network.
“As a relationship bank in a digital world, we’re proud to lead the industry by delivering a new payment option through VRP, which will make it easier for businesses and their customers to manage payments for a wide range of services,” said Daniel Globerson, head of bank APIs at NatWest.
Of all the high street banks, NatWest has been pushing the hardest for VRP, back in December demonstrating the first variable recurring payment in-action and then in March showing VRPs being used in a commercial setting via its Payit app.
Indeed, having one bank sign up to offer VRP as a payment option is far from a slam dunk for this technology to replace direct debits fully.
As we’ve seen with standalone open banking payments, in order to drive merchants and consumers to adopt this new account-to-account payment method the industry will still require near-universal coverage of bank accounts.