Open Banking is the new way for consumers to pay, allowing your business to accept payments by bank transfer in a modern and safe way.
Enabled by the European PSD2 regulations. Using Open Banking, customers initiate a payment to a merchant or corporate using their mobile banking App or online banking webportal, in exactly the same way that they would pay with bank transfer. Funds are then transferred to the merchant immediately using the real-time banking rails.
Open Banking removes the need for organisations to worry about the complexities of PCI DSS compliance, as the merchant does not accept, transmit or stores any cardholder data.
Consumers connect securely to their internet or mobile banking to make a payment, without disclosing any credentials or account details to the merchant, negating PCI DSS requirements.
The business further benefits from a reduction in fraud and subsequent chargebacks as the transaction is processed with full Strong Customer Authentication (SCA) in line with PSD2.
Settlement of funds is made in real-time, giving the organisation faster access to their cashflow and further savings are usually made as the Open Banking payments are typically processed at a lower rate that traditional card payments.
During the huge disruption caused by Covid-19, a study by the Open Banking Implementation Entity (OBIE) showed that over 2 million people now use online banking apps to make payments each month, with 80% reporting that is was ‘easier’ or ‘as easy as’ Paypal.
Open Banking is coming...
Is your business ready?