The Payment Expert Podcast is joined by Richard Mould from UKPI to discuss the launch of cVRPs in the UK, what sets them apart from direct debits and card-on-file, and what it will take to build a commercial open banking ecosystem
In the latest episode of the Payment Expert Podcast, Richard Mould from the UK Payments Initiative (UKPI) discusses the live launch of commercial variable recurring payments (cVRPs) in the UK – a milestone he calls a significant step in a five-year journey away from compliance-driven open banking toward a model built on commercial incentives.
The launch aligns banks, third-party providers and merchants around a shared interest in the scheme’s success. “It stops being a compliance exercise,” he says.
UKPI: Wave one and beyond
UKPI launches in two phases. Wave one, which is now live, covers a restricted but substantial set of use cases – payments to financial services firms, government, utilities and rail – before wave two opens up general e-commerce.
Mould says the phased approach is part of the complexity of launching a payment scheme for the first time in roughly 20 years in the UK, rather than any lack of ambition.
The Treasury statutory instrument needed to fully mandate participation and address competition risk is a key dependency for wave two, but Mould says all parties entered the initiative expecting it to arrive, and work on wave one is pressing ahead in the meantime.
Visibility and control as the consumer pitch
On the consumer side, cVRPs differ from both direct debits and card-on-file in two core ways: they run over Faster Payments, making them instant, and they come with configurable payment permissions – capping amounts and durations in a way that is visible directly in a user’s banking app.
Mould uses the subscription economy as the clearest illustration. Where consumers today often have little visibility over what they have authorised and at what limits, cVRPs would surface each permission alongside its constraints. There’s a parallel to be made with the early days of contactless: “Once you start using it and get familiar with it, it becomes a habit.”
He argues consumer adoption is not the immediate challenge, as “consumers aren’t interested in payments,” he says. The job for UKPI and the wider ecosystem is to function as plumbers – getting the infrastructure right so that billers are willing to put the option in front of customers in the first place.
Banks are backing it
As for the banks, who earn interchange on the card transactions cVRPs would displace, leading tp question they may not be as committed to cVRPs, Mould points to their active engagement with UKPI.
He describes cross-industry calls with 25 to 30 participants from banks and fintechs actively working through problems together, and says the scheme is owned by the institutions that helped create it. “We do not have a ‘them and us’ scenario,” he says.
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