Open Banking: Europe Strides in Open Payments

This week in Europe, London-based open finance platforms Yapily and Ecospend rolled out new initiatives to drive open payment adoption in the UK, and Germany’s Airbank teamed up with Klarna Kosma to secure access to account information from 15,000 banks in 26 countries.

As open banking continues to transform the landscape of European payments, platforms that facilitate seamless account-to-account payments are forging partnerships with a range of businesses to usher in the new age of open finance.

UK Platforms Expand VRP

In the last week, two of the U.K’s foremost open banking solution providers announced new collaborative initiatives that will drive the payments sector forward and help a greater number of institutions realize the full potential of account-to-account connectivity.

On Wednesday, Yapily launched its new Variable Recurring Payments (VRP) solution, Yapily VRP. With VRP, to receive payments, businesses only need to authenticate customers once. After that, customers can make payments quickly and easily without the need for additional authentication.

As part of the launch, Yapily is extending the benefits of VRP by partnering with Ozone API. Together, Yapily and Ozone API have built a complete solution for banks and financial institutions to commercialize their APIs.

The first client to roll out Yapily VRP is Volume, the one-click checkout payments platform, which will offer the service to its UK merchant customers.

With VRP, merchants are able to automatically collect payments of different values ​​from their customers, providing a more flexible and less cumbersome alternative to standing orders and direct debit.

VRP payments are on the rise in the UK, where the Competition and Markets Authority (CMA) has mandated that the nine largest banks must support VRP for sweeping (me-to-me payments) by July 31, 2022.

Last week, Plaid launched the beta version of its own VRP tool in the country, which has been integrated into the payments app Expensify. Plaid’s VRP solution allows Expensify to automatically pull varying repayments from its customers’ business accounts to settle card balances.

Read more: Plaid Pilots Payments Tool to Streamline Recurring Payments

The latest developments mean that competition is heating up for VRP service provision in the UK Yapily and Plaid now join TrueLayer, which rolled out VRP payment support to its customers in April.

More on this: TrueLayer, Thunes Team on Open Banking Payments in Europe, UK

Ecospend and Klarna Kosma Pick up New Clients

In another boost for the U.K’s open banking ecosystem, the enforcement and debt resolution provider CDER Group has tapped Ecospend to provide seamlessly integrated account-to-account payments thanks to its ‘Pay-by-Bank’ solution.

CDER Group is the holding company for JBW, Phoenix Commercial Collections and Collect Services. Together they provide debt collection and resolution services for UK Government and commercial clients.

CDER’s Pay-by-Bank creates an additional payment channel with which people will be able to make repayments via their own mobile or online banking app without the need to share personal information or card details.

Since May, Ecospend has been owned by Swedish FinTech Trustly, thanks to a deal that allows the two companies to partner on open banking initiatives in the UK and combine their respective experience in account-to-account payments.

See also: Trustly Acquires Ecospend, further strengthening position in the UK

Finally, Klarna Kosma, the FinTech arm of buy now, pay later (BNPL) firm Klarna, this week revealed that it will be supporting the German financial management platform Airbank as it rolls out open banking payments for SMEs. Thanks to the new deal, Airbank will gain secure access to account information from 15,000 banks in 26 countries via Klarna Kosma’s API integration.

Klarna first entered the open banking space when it acquired the German bank-to-bank payment service SOFORT in 2014. Since then, it has continued to grow its in-house open banking capabilities.

The company uses open banking to provide spending insights to millions of shoppers who use the Klarna app and to provide additional, real-time data.

With Klarna Kosma, the company is looking to monetize its proprietary technology by offering the service to third parties.

Related: Klarna Unveils ‘Klarna Kosma’ Open Banking Unit

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