UK-based PayPoint has begun offering bank-to-bank transfers as a payment initiation service provider (PISP) to pay-as-you-go energy customers with its new Pay by Bank service.
According to PayPoint, this makes it the first Open Banking provider to offer bank-to-bank payments to pay-as-you-go customers.
Jo Toolan, director of client services at PayPoint, said: “We are committed to investing in and growing our digital payments offering, including our suite of Open Banking solutions.
“Our most recent Pay by Bank solution offers customers a payment method that requires fewer steps and less data input than others, thereby reducing friction in a customer’s payment journey.
“Uniquely, we have paired this payment option with a pay-as-you-go vend, enabling the service for customers using a smart meter.”
When a customer selects the Pay by Bank option on the merchant’s website or app they are required to provide their consent, at which point, PayPoint as the PISP, connects to the customer’s bank account to initiate the payment.
Once the customer authenticates the payment using their banking app, the payment is processed and transferred to the merchant’s account typically within two hours.
PayPoint said that businesses receiving funds via this method benefit from faster payments at a lower cost per transaction than traditional card payments that involve third-party fees.
Toolan called the launch of Pay by Bank “a major milestone in the evolution of our Open Banking offering”.
PayPoint’s existing Open Banking portfolio includes Confirmation of Payee, Payer Name Verification (PNV) and account information services solutions.
It added PNV to its portfolio in August, with businesses able to use the service to confirm in real-time that account information provided by a payer corresponds to the account number, sort code, and name registered with the bank.