Smart data and future sectors
What will it take for open banking to be used in the utilities industry and drive mass adoption?
Holly Coventry
Vice President, American Express
Open banking continues to transform payments, and is making real headway in sectors such as Utilities. Through our partnership with OVO Energy we’re seeing first-hand the increasing numbers of billpayers choosing to settle their energy bills via open banking products, such as our Pay with Bank Transfer. This enables people to pay easily and quickly directly from their bank account, without the need for a debit or credit card.
The seamless nature of the experience, paired with the fact that it puts users in control, is ultimately what is driving adoption at checkout. And, as expectations from consumers continue to grow, providing a streamlined, and secure payment experience is essential for utilities companies to remain competitive. There is no time like the present to explore open banking payments, even if providers start by dipping their toe in with a small use case.
However, there is still more to do to build on the great momentum we’ve seen around open banking. Research published last year by Pay with Bank Transfer highlighted that strong security is the number one thing that would encourage people to use open banking payments more often, and one in four said they feel concerned about ‘new’ payment methods, despite evidence that the clear majority of people had already used an open banking product without even realising it.
It’s therefore important that industry players continue to build understanding and educate customers to foster genuine trust - this will be a crucial step in boosting awareness and further adoption.
What will it take for open banking to be used in the retail sector and drive mass adoption?
Tom Burton
Director of External Affairs and Public Policy, GoCardless
If open banking-powered payments are to genuinely compete with cards at the checkout, merchants will need to be convinced that the payer experience is as good or better. We’ll see some innovative merchants testing out open banking payments in retail point-of-sale environments in 2025, mostly for high-value transactions, as the cost savings can be compelling.
But recent GoCardless-commissioned research concluded that merchant adoption of open banking is likely to be incremental, with sectors such as retail and hospitality probable stragglers.
A lot of work needs to be done to unlock these use cases such as speeding up payment confirmation times, better consumer awareness of an open banking ‘brand’, and ensuring open banking transactions can be accepted at payment terminals.
The issues are very solvable and this will happen quicker if industry and the regulators pull in the same direction. That’s why we strongly support HM Treasury’s National Payments Vision, which sets a goal of developing seamless account-to-account payments as a ubiquitous payment method.
The missing piece of the jigsaw is a sustainable commercial model between banks and payment initiation service providers such as GoCardless. Crack that and my bet is that blockers which have been around for years will melt away, and retailers and consumers will benefit sooner from cheaper, faster, more secure payments.
Mitchell Powers
UK General Manager, Trustly
Ecospend, a Trustly company, has been working closely with the UK’s public sector for open banking payments and data solutions for a long time. Leveraging technology, the integration of real-time payments enables faster transaction processing, reducing delays associated with traditional methods such as bank transfers or cheques. This can lead to considerable cost savings by minimising administrative overhead and manual processing errors.
Additionally, the automation of payment workflows decreases the workload on staff, allowing public sector organisations to allocate resources more effectively. Direct bank payment solutions enhance transparency and security, mitigating the risks of fraud or compliance issues, which often result in costly investigations or penalties.
We’ve worked with HMRC since 2021 and it has resulted in convenient and secure tax collection and refunds, improving tax collection processes. The reduction in reliance on card networks or third-party payment processors also eliminates intermediary fees, further lowering operational costs.
By improving efficiency and cost-effectiveness, the collaboration aligns with public sector goals of maximising taxpayer value while maintaining robust financial accountability.
