What is Open Banking?
Open Banking is a broad term within financial services that refers to applications designed to help consumers move, manage and make the most of their money, simply and securely. In simple terms, Open Banking is a framework that allows banks and financial institutions to share consumer financial data in a secure manner. It removes outdated technology often seen with cards and other dated payment methods, and enables users to make secure payments directly from their own bank accounts using account-to-account bank transfers.
Open Banking and the Payment Services Directive (PSD2) were introduced in 2018. Regulated by the Financial Conduct Authority (FCA), it encourages greater competition and transparency in the financial services industry. Open Banking has already gained widespread awareness and adoption across Europe and Latin America. Please see the Open Banking website for more information.
Vyne leverages Open Banking to allow merchants to take consumer payments via bank transfer. Payments via bank transfer mean merchants are paid quickly, securely and cheaply, using a method that consumers know and trust.
How do I know Open Banking is safe?
Open Banking has been designed with simplicity and security at it's heart - Strong Customer Authentication (SCA) is built into payment flows, reducing friction while retaining the highest level of security.
Bank-level security – Open Banking leverages the biometric security of your own online or mobile banking. You will never be asked to give access to your bank login details, PINs or passwords.
It’s regulated – only apps and websites provided by firms which are regulated by the FCA or a European National Competent Authority can enrol in the Open Banking Directory.
You’re in charge – you choose when, with whom, and for how long you give access to your data. With biometric sign-in, such as fingerprint (touch ID) or facial recognition (face ID), only you as the account holder can approve the payment, removing the risk of fraud.
Extra protection – your bank or building society will normally refund your money if unauthorised payments are made. You’re also protected by data protection laws, and you can make a complaint to the Financial Ombudsman Service as well.
Are there any limits to payments made using Open Banking?
Each Vyne payment is set up as a bank-to-bank transaction, which means payment amounts are only subject to bank channel limits for the payment rails used and the individual involved, similar to a bank transfer.
Please see our Payment Limits for UK Bank Providers page for a breakdown of the payment limits by most of top UK banks.
How fast is Open Banking?
Vyne helps merchants get paid fast, meaning the funds arrive in your account within a matter of seconds, not days. Vyne payments are processed as bank-to-bank transfers using the Faster Payments Scheme (FPS).
Whilst Faster Payments generally settle within a few seconds, this scheme mandates payments to a 2-hour SLA, meaning some payment may take longer to process. This is dependant on a number of factors, including the payment amount, the remitting bank and what checks they may carry out on the payment.
Have more questions around Open Banking?
Please consult the Open Banking website for more information and FAQ's.
Otherwise, please don't hesitate to get in touch with us and we'd be happy to assist with any other questions you may have, whether that's on Open Banking or how Vyne works within this scope.