Introduction
In the ever-evolving world of payment solutions, Pay By Bank stands out as a game-changer. While it’s still relatively new, this innovative payment method is quickly gaining traction for its efficiency, cost-effectiveness, and ease of use. If you’re looking to stay ahead in the payment industry, it’s crucial to understand what Pay By Bank offers and how it can benefit your business. Let’s dive into the six key things you need to know about Pay By Bank.
What Is Pay By Bank and How Does It Work?
Pay By Bank is an innovative payment method powered by the Open Banking initiative. It allows customers to make direct bank-to-bank transfers using their desktop, mobile device, or banking app—without the hassle of remembering sort codes or account numbers. Customers simply select their bank, verify their identity through their online banking details, and choose the account from which they wish to pay. The funds are transferred instantly, making transactions quick and seamless.
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Lower Processing Fees Compared to Card Payments
One of the most compelling benefits of Pay By Bank is its lower processing fees. Traditional card transaction fees can reach up to 2.5%, whereas Pay By Bank charges only 0.3% per transaction. This significant difference in fees can lead to substantial savings, especially as more customers opt for this payment method. In fact, higher transaction volumes and values with Pay By Bank can result in even greater savings for your business.
To get a clear picture of how much you could save, try out our savings calculator here.
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Pay By Bank Complements Existing Payment Methods
Pay By Bank isn’t here to replace your current payment options; it’s here to enhance them. Offering multiple payment methods, including Pay By Bank, alongside traditional credit and debit card options, increases convenience for your customers. This flexibility allows customers to choose the payment method they are most comfortable with, potentially increasing your conversion rates.
If you're looking to optimise your payment processing further, we can assess your current setup with our network of 260 gateway and merchant service partners, ensuring you get the best rates on all transactions. Our platform also supports a variety of payment methods, including Direct Debit, digital wallets like Apple Pay and Google Pay, and Buy-Now-Pay-Later options such as Klarna.
Why Pay By Bank Is the Future of Payments
As Pay By Bank continues to grow in popularity, it’s clear that this payment method is more than just a passing trend. With widespread adoption in the UK and endorsements from significant entities, it’s becoming a must-have option for businesses.
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A Growing Number of UK Customers Are Ready for Pay By Bank
Currently, over 90% of UK customers have the necessary online banking details to use Pay By Bank, with more than six million actively transacting through the service. Since it’s backed by the Open Banking initiative, users can trust that their transactions are secure and straightforward, using familiar online banking credentials. This ease of use is driving rapid adoption across the UK.
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Endorsement by HM Revenue & Customs (HMRC) Boosts Credibility
HM Revenue & Customs (HMRC) began using the Pay By Bank service in March 2021, making it one of the first government agencies worldwide to integrate Open Banking into its operations. This service initially allowed taxpayers to make payments for self-assessment tax returns. Over time, HMRC expanded the service to include 24 different types of tax regimes, such as PAYE, corporation tax, VAT, stamp duty, capital gains tax, and gambling duties (Global Government Fintech) (Global Government Fintech).
As of early 2024, HMRC has collected over £3.3 billion in tax payments via the Pay By Bank method, with more than one million transactions completed since the start of the year (Open Banking Expo). This approach not only simplifies the payment process for taxpayers but also reduces errors and potential fraud, enhancing the overall efficiency of tax collection (Global Government Fintech) (Global Government Fintech).
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Simple Payment Requests via Smart Links
Pay By Bank can be easily integrated into your payment process, allowing you to send payment requests to any device. Whether through telephony, email, SMS, WhatsApp, Live Web Chat, or any popular social media messaging platform, Pay By Bank’s smart link technology ensures that your customers can pay conveniently from anywhere.
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High-Value Clients Are Embracing Pay By Bank
Real-world data shows that Pay By Bank is not just a niche option—it’s rapidly becoming a preferred payment method among high-value clients across various industries. By analyzing hundreds of thousands of transactions, we’ve seen that clients who promote Pay By Bank often see a reduction in fees and an increase in customer satisfaction. With more businesses eager to tap into the growing user base, Pay By Bank is set to play a significant role in the future of payments.
Conclusion
The future of payments is here, and Pay By Bank is at the forefront of this revolution. With lower fees, ease of use, and growing adoption across the UK, it’s an option that businesses can no longer afford to ignore. Whether you’re looking to save on transaction costs or offer your customers more payment flexibility, Pay By Bank is a solution worth considering.
Talk to Us About Implementing Pay By Bank
Interested in learning more about how Pay By Bank can benefit your business? Reach out to Gala Technology today at +44 (0) 1709 911 661 or email us at sales@sotpay.co.uk. Let’s discuss how we can help you integrate this innovative payment method into your existing system.
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