Open banking and VRP progress reports

The Joint Regulatory Oversight Committee has updated on progress in open banking. It is pleased with the significant progress made since its April report, and has summarised what has been happening across all its workstreams. Initiatives include improving availability, mitigating the risks of financial crime, improving consumer protection, better information flows and promoting additional services using non-sweeping Variable Recurring Payments (VRP) as a pilot. It set up a working group in the summer and has now drafted a delivery plan.

The report also looks at the longer term plan for a new regulatory framework to support wider open banking.

The VRP blueprint had recommended payments for utilities, financial services, and central and local government as initial use cases. VRPs enable customers to connect authorised payment providers to their bank to initiate recurring payments – which can be made up to a fixed limit only with the customer’s consent. Currently, VRPs are used only for transfers between accounts of one person.

Alongside the report, PSR is consulting on changes to Faster Payments that will enable a phased expansion of VRP. It asks how these can be rolled out to support a set number of low risk use cases.  Consultation closes on 2 February.