Visa has completed its first commercial variable recurring payment (cVRP) through its account-to-account (A2A) payments solution in the UK.
This transaction, aimed at demonstrating the payment of an energy bill to Utilita, was facilitated by Visa’s A2A open industry model. Traditionally, UK consumers rely on Direct Debit for managing recurring bills and subscriptions. However, Visa’s research indicates that 60% of UK consumers would be open to trying a new payment method if it were available.
Visa’s A2A offering aims to provide this alternative for both businesses and consumers, delivering immediate payment confirmation along with improved transparency and control in managing recurring payments. The A2A solution also promises enhanced consumer protections, comparable to those associated with card payments, along with a dispute resolution mechanism to assist users in reclaiming their money in the event of issues.
Rooted in open banking principles, the A2A model encourages collaboration among banks and industry partners to establish standards and rules for cVRPs. It is designed to be adaptable across various sectors and use cases, focusing particularly on bills, subscriptions, and low-risk e-commerce.
The initial payment involved Visa-owned open banking specialist Tink initiating the transaction on behalf of the payer. Kroo Bank then processed the payment directly from the payer’s bank account in real-time via the UK’s Faster Payments Service. Visa coordinated the transaction using its A2A solution, overseeing the operating model, liability and dispute framework, and user experience guidelines, before energy company Utilita finalized the establishment of the commercial variable recurring payment mandate through its app.
Mark Wilcocks, VP and head of products and solutions at Visa UK & Ireland, stated: “Today marks a significant milestone in UK payments innovation with the first commercial Variable Recurring Payment transaction powered by Visa A2A. This advancement illustrates how industry collaboration is reshaping the way consumers and businesses handle recurring payments. For consumers, it provides enhanced control, transparency, and security when settling bills — eliminating surprises and delays. For merchants, it facilitates faster settlement, improved cash flow, and a reliable payment experience for their customers.”