Following recent live tests, NatWest 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
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. This is a change to the current Open Banking status quo where TPPs can only initiate single immediate payments and customers have to authenticate each payment separately.
James Hodgson, head of Payit describes VRP as a turning point for Open Banking: "It is set to revolutionise the way payments are made online and will look to replace current traditional payment methods such as Direct Debit and Card on File in the future. VRP introduces a mechanism to authorise future payments within pre-agreed limits, meaning consumers can benefit from a new level of payment automation, while experiencing greater transparency and control over their finances.
Working with Open Banking infrastructure provider TrueLayer, NatWest has delivered its VRP API ahead of schedule and conducted its first test transaction in a live environment.
“This marks a pioneering milestone for the development of this functionality," says Hodgson. "The achievement is a major step as it proves Payit’s solution works in a live environment, rather than a testing sandbox."
The Payit page on the bank's Website cites The Captain Tom Foundation, FreeAgent and Northern as current customers. The first pilot will commence with NatWest's Rapid Cash service, which enables businesses to borrow against their unpaid invoices and get a flexible line of credit in return.
Says Hodgson: “As an early adopter of the new payment method, we are seeing a lot of excitement in the industry, with many customers contacting Payit about VRP. Our pilot in Q2 will provide the opportunity to perfect the proposition for a future customer roll out, ensuring the best possible experience can be provided for both businesses and consumers.”