Visa to ‘upgrade’ Pay by Bank experience with UK launch of Visa A2A
Visa has announced the launch of Visa A2A in early 2025, which is an “open system” designed to give consumers more control and protection when making account-to-account (A2A) payments.
When Visa A2A debuts in the UK early next year, it will provide consumers with an improved digital user experience, advanced security features, and an “easy-to-use” dispute resolution service that will help people get their money back should something go wrong.
Visa said that Visa A2A is “a significant upgrade to the current pay-by-bank experience”.
Visa A2A will be based on an “open system” made available to all eligible banks and other industry partners to join, which introduces standards, rules and a dispute management service to help protect consumers and further modernise open banking-based payments.
It is being designed in partnership with several UK fintechs, including Banked, Modulr, Moneyhub, Salt Edge, Vyne and Yaspa, and will be delivered by UK industry players working with Visa.
From early 2025, banks and businesses in the UK will be able to offer Visa A2A to consumers making bill payments, such as utilities, rent and childcare fees, with plans to introduce a way to better manage subscriptions for products and services, such as gym memberships and digital streaming.
For businesses, the benefits of using Visa A2A include notifications if a consumer changes or cancels payment permissions, and it also provides them with the ability to include more transaction data for reconciliation, according to Visa.
In 2023, £3.7 trillion was paid via A2A Faster Payments in the UK, up 15% on the previous year, according to Pay.UK’s 2023 annual report.
“Bank payments are a popular way to pay bills and services but have remained largely unchanged since the inception of direct debit 60 years ago,” Mandy Lamb, managing director, Visa UK and Ireland, said.
“We want to bring pay-by-bank methods into the 21st Century and give consumers choice, peace of mind and a digital experience they know and love,” Lamb added. “That’s why we are collaborating with UK banks and Open Banking players, bringing our technology and years of experience in the payments card market to create an open system for A2A payments to thrive.
“Visa A2A will ensure consumer-to-business bank transfer payments have similar levels of protection that consumers are used to when they use their cards.”
Visa A2A’s formal dispute resolution process will provide consumers with a way to check transactions, while the use of biometrics will add a new level of security that Visa said will result in fewer unauthorised transactions.
Otto Benz, director of payments at Nationwide Building Society, said: “We know that businesses and consumers alike are keen to explore the benefits of A2A transactions, and we expect demand to increase in the coming years.
“The industry will need to collaborate on innovations such as Visa A2A if we are to put in place the necessary rules, capabilities and consumer protections that will unlock the full potential of A2A.”
Barclays’ Rob Levy
Rob Levy, director, POS lending products, Open Banking and digital platforms at Barclays, said: “We are supportive of initiatives that drive competition and innovation in A2A payments, and an industry-led scheme solution is one of the many ways to deliver this.”
Consumers using Visa A2A will be able to set up and manage payment permissions, giving them more control over when payments are made, and will also be able to set limit amounts.
Karl MacGregor, Vyne’s chief executive officer, called it “an industry-led solution” which “unlocks” the future of Open Banking – variable recurring payments – by leveraging the industry’s collective experience of developing and operating payments systems at scale.
“This initiative is the first big step on the path to improve the way merchants and consumers pay and get paid,” MacGregor added.
Further reading: Can Faster Payments unseat debit card payments in the UK?
Representatives from Nationwide, Moneyhub, Pay.UK and Salt Edge and other banks and fintechs are speaking at Open banking Expo UK & Europe in London on 15-16 October. Click here to find out more about the stages, content, speaker line-up and exhibitors.