OBIE consults on Variable Recurring Payments and Sweeping

By Robin Amlot

The UK’s OBIE (Open Banking Implementation Entity) has launched consultations on Variable Recurring Payments and Sweeping, a move it described as representing the next stage in the development of open banking in the UK.

Variable Recurring Payments (VRPs) allow customers to safely connect authorised payments providers to their bank account so that they can make payments on the customer’s behalf, within agreed parameters that offer more control and transparency than existing alternatives. Sweeping is the automated movement of funds for a customer between two accounts in their name, usually to help the customer avoid charges or benefit from better interest rates.

The first phase of the OBIE Consultation Process takes place between the 9 November and 4 December 2020 and a summary of the responses will be published before the Christmas break. A further phase of consultation expected to commence towards the end of January, with final decisions expected in early Spring. Webinars will be held, open to all stakeholders, to discuss the proposal and obtain feedback. The first webinar will take place on 11 November 2020.

Jack Wilson, Head of Policy and Regulatory Affairs at TrueLayer, commented: “We’re pleased to see variable recurring payments (VRP) and Sweeping now being discussed in the OBIE’s latest consultation. In our view, it makes complete sense for the banks to meet the CMA (Competition and Markets Authority) order that requires banks to introduce sweeping by implementing VRP APIs. The VRP infrastructure will boost the competitiveness of PISPs, allowing them to provide cheaper alternatives to direct debit and card on file. At the same time, sweeping can transform the UK savings market, allowing fintech firms to make saving effortless for consumers. We look forward to working with the OBIE on the development of the standard.”

OBIE was created by the CMA to deliver Application Programming Interfaces (APIs), data structures and security architectures. It is funded by the UK’s nine largest current account providers and overseen by the CMA, the Financial Conduct Authority and HM Treasury. The nine institutions are: AIBG, Bank of Ireland, Barclays, Danske, HSBC, Lloyds Banking Group, Nationwide, RBS and Santander.