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OBIE ‘oversees’ HSBC roll out of variable recurring payments
The move by HSBC comes as part of an open banking push from the CMA, who has mandated that banks must implement VRP.
HSBC has rolled out Variable Recurring Payments (VRP) to its customers.
VRP, also known as ‘sweeping’, is a form of open banking payments similar to direct debts that can be used by both businesses and consumers.
As payments can be for varying amounts and do not need to be re-authenticated for each transaction, VRPs represent a significant evolution for open banking.
The Competition and Markets Authority (CMA) had mandated the UK's nine largest banks to implement VRP by 31st July 2022, following a six-month extension.
Customers of both HSBC Personal and HSBC Business brands will be able to use the service which was overseen by the Open Banking Implementation Entity (OBIE).
“Sweeping VRPs allow for the automated movement of funds between a customer’s own accounts without the need for any manual intervention once the initial consent is setup. This service can, for example, be used to pay off a monthly credit card bill, move money regularly into a savings account or to reduce an overdraft balance,” HSBC said in a blog post.
So far, customers of First Direct and HSBC Kinetic, its two other banking brands are not yet able to access VRP but the bank suggested this will happen soon.
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