TrueLayer has unveiled a recurring payments API capable of dealing with both sweeping and non-sweeping use cases. The Competition and Markets Authority(CMA) has mandated the UK’s nine largest banks to provide Variable Recurring Payments (VRPs) that support the automatic transfer of money between two accounts belonging to the same person.
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.
However, amid some confusion over what use cases fall within the scope of the Sweeping definition, the CMA has stressed that the practice cannot be mandated for making e-commerce purchases.
Matt Parish, product lead for VRP at TrueLayer, comments: “The mandated approach, while beneficial, only supports payments between an individual customer’s accounts, limiting the ultimate potential of VRP. We are proud to announce the industry’s first recurring payments API that goes beyond that mandate to deliver comprehensive payment options that will create a better customer experience.”
TrueLayer says it is collaborating with select banks around non-sweeping, offering businesses recurring payments to their customers for a range of services, including utility bills, subscriptions and other forms of digital payments. Using VRP through TrueLayer enables the amount being collected to vary without needing the account holder to re-consent every payment – for example, utility bills with a fixed payment date but different amounts due each time.
The firm has already signed up NatWest, which is to begin pilot testing of variable recurring payments with its open banking payments product Payit in the first half of 2022, with plans to scale to a commercial product ready by early 2023
“We have a number of clients that have seen the potential for VRP to deliver significant benefits to their business and their customers, working with us to implement sweeping and non-sweeping recurring payments in the coming months,” says Parish. “We believe that, to truly deliver on the promise of Open Banking, boost fintech innovation in the UK and provide businesses and consumers with payment options that work for them, every CMA9 and non-CMA9 bank should make VRP APIs for sweeping and non-sweeping available as soon as possible.”