Open Banking payments hits new record milestone

Open Banking has reached a significant milestone, surpassing 11.4 million payments in the UK in July 2023. This achievement reflects a 9.3% increase in total payments compared with the previous month, highlighting the growing adoption of Open Banking services.

Open Banking payments hits new record milestone

Year-to-date data for 2023 against 2022 shows that total payments have doubled, showing an exceptional 102.4% growth.

This remarkable surge underscores the rapid pace at which Open Banking is reshaping the financial and payments landscape and reinforces the pivotal role it plays in driving financial inclusion, innovation, and consumer empowerment.

In July 2023, the number of active payment users surged to 4.2 million, a 10.5% rise from June 2023 and up 68.2% on July 2022.

This robust growth signals a growing use among consumers using Open Banking solutions to manage their finances effectively.

Among the key drivers of growth are single domestic payments, which recorded 10.5 million transactions in July, marking an 8% increase from June.

This was propelled by several significant events, including government payments solutions and the onboarding of leading UK financial institutions and investment platforms.

These institutions have introduced “pay by bank” options, allowing users to conveniently fund a wide variety of savings and investment products. Notably, these transactions align with the top three use cases for Open Banking transactions, ranked in order of volumes:

• Account top-ups: Users embraced the option to top up their e-money transactional or current accounts, as well as savings and investment (S&I) products. This demonstrates the convenience and efficiency it brings to managing personal finances.
• Credit card bill payments: Streamlining the process of settling credit card bills, offering users a seamless way to make payments towards their credit card balances and simplify their financial management.
• E-commerce: Its impact on online shopping, especially in e-commerce, is notable. Vendors, in particular, benefit from cost savings on card transaction fees. While currently more prevalent in e-commerce, this payment option lets vendors confirm receipt of funds before releasing goods, enhancing financial security and potentially transforming vendor strategies.

Variable recurring payments (VRPs) also saw substantial growth, with 872,000 transactions in July, representing a notable 28.7% increase on the previous month.

All-time data shows that single domestic payments have now reached 163.2 million. For the year-to-date the growth is more pronounced. Single domestic payments have surged to 65 million, showcasing a significant increase of 95.6% compared with the same period last year.

“The strong and sustained growth in Open Banking payments underscores the rapid pace at which Open Banking is reshaping the financial and payments landscape,” notes Marion King, Chair and Trustee of Open Banking Limited.

“It reinforces the pivotal role open banking plays in driving financial inclusion, innovation, and consumer empowerment.

As it continues to redefine the way people manage their finances, the doubling of total payments in just one a year is a remarkable achievement and testament to the transformative impact of Open Banking.”

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