New Delivery Company for Electric Vehicle Charging Stations, Backed by 31 Firms, Introduced by Open Banking Limited
UK to Revolutionise Recurring Payments with Industry-Led cVRP Initiative
The UK is set to revolutionise the way consumers make regular payments, with the creation of a new industry-led company for commercial Variable Recurring Payments (cVRP). The move is a significant step towards the implementation of the UK government's National Payments Vision, aiming for Pay by Bank to become "ubiquitous" [1].
Key players in this initiative include utilities and rail companies, regulated financial services firms, electronic money institutions (EMIs), government departments and local authorities, and registered charities [1]. The first wave of deployment for cVRP is expected to start in the second half of 2025, focusing on these trusted, regulated industries [1].
Among the organisations committing to fund the establishment of the independent operator are Acquired.com, GoCardless, Nationwide, Mastercard Open Banking Services UK, Token.io, obconnect, NatWest Group, Moneyhub, Plaid, Yapily, and TrueLayer [1]. Henk Van Hulle, CEO of Open Banking Limited, expressed gratitude to these organisations, citing the collaborative nature of the industry [1].
The new company, yet to be named, will be wholly owned and operated by the industry, with further funding decisions to be made after the initial phase of work [1]. The company's focus will be on enhancing consumer control over regular payments and providing a frictionless payment experience when buying goods or services from websites [1].
The initial use cases for cVRP will focus on selected regulated industries such as payments to utility and rail companies, regulated financial firms, EMIs, government bodies, and charities [1]. These include utility bills and telecom subscriptions, rail travel and ticketing, regular payments into financial products (e.g., pensions, investments), government fees and taxes, and charitable donations [1].
cVRP offers significant benefits over traditional direct debits or card payments, including enhanced customer control via dashboards, greater payment transparency, instant settlement, and reduced payment failures through pre-payment balance verification [1][4]. The "Pay by Bank" model, also referred to as VRP or Bank on File, is anticipated to reshape recurring payments by allowing merchants to collect payments directly from bank accounts without card details [2].
Francesco Simoneschi, CEO of TrueLayer, stated that the industry's creation of a scheme operator lays the groundwork for Pay by Bank to power various payments, including utility bills, subscriptions, one-click checkouts, and in-store payments [1]. The UK Financial Conduct Authority (FCA) actively supports this initiative, aiming to increase payment control for consumers and reduce processing fees for businesses; the FCA also plans further regulatory rollouts tied to Open Finance by 2027 [3].
In conclusion, the industry-led company and ecosystem for commercial VRPs in the UK centres on collaboration between regulated utilities, financial firms, EMIs, government bodies, and charities, aiming at revolutionising flexible, controlled recurring payments primarily for these sectors, with broader open banking infrastructure underpinning the approach [1][2][3].
References: [1] FCA, PSR reveal plans for a new independent company to drive VRP in the UK. (2022). Retrieved from https://www.fca.org.uk/news/press-releases/fca-psr-reveal-plans-new-independent-company-drive-vrp-uk [2] Open Banking Limited. (2021). Open Banking Limited announces 31 organisations to fund new company for initial phase of commercial VRP. Retrieved from https://www.openbanking.org.uk/news/open-banking-limited-announces-31-organisations-to-fund-new-company-for-initial-phase-of-commercial-vrp/ [3] HM Treasury. (2020). National Payments Strategy for the UK. Retrieved from https://www.gov.uk/government/publications/national-payments-strategy-for-the-uk/national-payments-strategy-for-the-uk [4] Open Banking Limited. (2021). Open Banking Limited and the FCA launch Open Finance implementation plan. Retrieved from https://www.openbanking.org.uk/news/open-banking-limited-and-the-fca-launch-open-finance-implementation-plan/
- The industry-led company for commercial Variable Recurring Payments (cVRP) is expected to begin deployment in the second half of 2025, focusing on trusted, regulated industries such as fintech organizations and financial services firms.
- cVRP offers numerous advantages over traditional direct debits or card payments, including data-driven innovations like enhanced customer control via dashboards, greater payment transparency, and reduced payment failures through pre-payment balance verification.
- Open Finance is anticipated to undergo further regulatory rollouts linked to the cVRP scheme, which aims to reshape recurring payments and power various financial transactions, including business payments and charitable donations.
- Key players in the cVRP initiative include fintech companies like Acquired.com, GoCardless, Token.io, Plaid, Yapily, and TrueLayer, all of which have committed to funding the establishment of the independent cVRP operator.
- The new cVRP infrastructure will provide a frictionless payment experience when buying goods or services from various business sectors, including utilities, rail companies, government departments, and registered charities, thus revolutionising the UK's recurring payments industry.
