The UK’s embracing of VRPs continues to evolve with NatWest becoming the first firm to offer non-sweeping VRPs to the market.
In what is a significant move for the space, it expands the usage and opportunities of VRPs – which are predominantly used within payments from the same account.
Daniel Globerson, Head of Bank of APIs at NatWest Group, commented on the move and what it means for VRPs: “As a relationship bank for a digital world, we’re committed to offering innovative and convenient payment methods to businesses and consumers.”
The UK’s debut non-sweeping VRPs involved transactions between NatWest customers, Charity Right and Pink Chilli.
Underlining the importance of non-sweeping VRPs into the sector, Globerson added: “We’re delighted that our customers are now experiencing the benefits of VRP, and we’re proud to see organisations such as Charity Right using VRP to manage charitable donations.”
Sajad Mahmood, CEO at Charity Right, said: “We’re delighted to be the charity partner in this innovative trial with GoCardless and NatWest. Recurring donations are the lifeblood of charities, and VRPs will enable our supporters to give regularly in a way that works for them.
“These incremental donations will bring us that much closer to reaching our goal of providing regular, nutritious school meals to children around the world, lifting themselves, their families and even their communities out of poverty.”
The move comes after regulatory changes introduced by the CMA, stating that the UK’s nine largest banks must support sweeping.
In an interview with Payment Expert, Michael Bridgman, GoCardless Group Product Manager, lauded the move and its impact on the UK’s open banking roadmap.
He commented: “The addition of VRP to Open Banking shows the CMA’s determination to deliver on its objectives, and should be applauded. VRP offers several advantages over existing payment mechanisms: it’s more secure and efficient compared to cards, and faster relative to Direct Debit.
“Under the Open Banking roadmap, VRPs are restricted only to use cases where money is being moved between two accounts in the same name. So, in the short-term, the aim is to make it easier for consumers to maximise their money by reducing interest payments on credit, and easily shifting money to higher-return accounts or investments.
“In the medium to long-term, these standards could be re-used by banks for any use case – creating a very real competitor to cards and direct Debit, and fundamentally changing the payments ecosystem. This innovation in recurring payments is rare and sets an example for other ecosystems to follow.”