UK open banking tops 1bn payments as Pay by Bank goes recurring

UK open banking has crossed a milestone: more than 1 billion cumulative payments since the system began, with the threshold passed in June 2026, according to a 21 September 2026 assessment from Open Banking Limited (OBL), the body that oversees the UK's open banking standards. A month earlier, in May 2026, the number of open banking payments made in a single calendar month exceeded 40 million for the first time.

Those two figures matter to anyone who banks, shops or runs a business in the UK, because open banking payments now cover a large and fast-growing volume of everyday transactions: paying a bill directly from a current account, topping up an investment platform, or settling an invoice without typing in card details. But the milestone measures volume, not maturity. The more consequential question, and the one this article tests, is whether a newer variant of the technology — commercial variable recurring payments, marketed by some providers as Recurring Pay by Bank — can do what cards and Direct Debit already do: collect subscriptions and repeat purchases automatically, at scale, across most UK bank accounts.

What the billion-payment figure actually measures

OBL reported 45% year-on-year growth in open banking payment volume for the 12 months to July 2026, alongside a separate measure of application programming interface (API) activity: total API calls grew 30% year on year over the same period and reached a record 2.94 billion calls in July 2026 alone, with cumulative API calls passing 100 billion in June 2026. User connections to open banking services rose 26% year on year to July 2026.

These are not the same thing as payments, and conflating them overstates what has happened. OBL attributes roughly 80% of API traffic to account information services — the read-only function that lets an app see a user's balances and transactions — while payment-initiation API call volume, the function that actually moves money, grew 44% year on year in the same period. A single payment can also generate multiple API calls, so call counts and completed-payment counts are not interchangeable.

There are further gaps in what is publicly known. OBL's cited assessment does not disclose the exact cumulative payment total, the precise May 2026 monthly figure, or the methodology for whether failed, reversed or test transactions are included in the count. Until OBL publishes that detail, the billion-payment figure should be read as a strong signal of growing usage rather than a precisely verified total comparable to card or Direct Debit statistics.

From one-off Pay by Bank to a recurring mandate

The billion-payment aggregate covers open banking payments generally — among them a shopper approving a single transfer at checkout, or a taxpayer settling a bill — and OBL's cited assessment does not break the total down by payment type, so it does not show how many were one-off payments, sweeping VRPs or commercial VRPs. A variable recurring payment (VRP) is different from a one-off payment. It lets a payer authorise, in advance, a series of payments at flexible intervals and in variable amounts, within limits authorised in advance by the payer — one authorisation, multiple future collections.

The only form of VRP that relevant account providers covered by the CMA's open banking framework are currently required to support is sweeping: moving money between accounts that belong to the same person, such as sweeping cash from a current account into a savings account to avoid an overdraft. That mandated requirement applies to those relevant account providers specifically, not to every UK bank. The Competition and Markets Authority (CMA) approved VRP as the mechanism for sweeping under the Open Banking Roadmap in July 2021, with an extended implementation deadline of July 2022, and HM Treasury's July 2026 consultation on modernising payment-services regulation confirmed that relevant account providers covered by the CMA's framework must continue to provide sweeping functionality free of charge.

Commercial VRP (cVRP) extends the same mechanism to payments made to third parties — a merchant, a utility, a charity — rather than between a customer's own accounts. That extension is where recurring Pay by Bank enters the picture, and where the industry still has ground to cover.

What went live in June 2026

A commercial scheme called UKPI (UK Payments Initiative) went live on 2 June 2026, according to GoCardless, a payment provider that participated in the scheme and now markets its implementation as Recurring Pay by Bank. GoCardless said it had completed a recurring open banking transaction for Jellyfish Energy during live testing in March 2026, but it has not published transaction volumes for the production scheme since launch.

That timing is itself worth noting as a contradiction rather than smoothing over: the Financial Conduct Authority (FCA) and the Payment Systems Regulator (PSR) had expected, in their December 2025 delivery update, that the first live UKPI payments would take place in the first quarter of 2026. The scheme's formal launch arrived several months later, in June. Whether "first live payments" in regulators' earlier language meant testing or full production is not resolved in the sources reviewed, but the gap between that expectation and the actual launch date illustrates a pattern of slippage in delivering commercial VRP capability.

It is also important to separate two layers that are easy to blur. Regulated payment initiation is carried out by a payment initiation service provider (PISP) that holds the relevant FCA authorisation or registration under payment-services law. UKPI itself is an industry-operated commercial scheme — it supplies the contractual, operational, liability and pricing arrangements between banks and PISPs, but participation in UKPI does not itself authorise anyone to initiate payments, and UKPI is not a separate statutory payment category. "Recurring Pay by Bank" is a provider's product name for an implementation of cVRP, not the name of a market-wide regulated scheme.

UKPI's initial phase is also narrower than general retail subscriptions. Regulatory material describes the first wave as covering lower-risk areas: regulated financial services, regulated utilities, and local and central government payments. GoCardless's own description of its launch additionally mentions charities among the initial use cases. Broader e-commerce and open-ended subscription retail remain part of a later expansion, not the current scope.

Can it actually handle subscriptions and repeat purchases?

Technically, yes, in the sense that a VRP mandate is built to support exactly this: a single authorisation followed by collections that vary in amount and timing, executed account-to-account, within the limits set in the mandate.

Commissioned survey work gives some sense of appetite rather than adoption. GoCardless-commissioned surveys carried out in December 2025, covering 500 UK business decision-makers (489 of which accept recurring payments) and 2,000 UK adults, found 49% of businesses intended to be early adopters of recurring Pay by Bank and 38% of consumers said they were open to trying it. These are stated intentions from a commissioned survey, not measured usage, and should be read with that caveat.

No source reviewed for this article gives production transaction volumes, active mandate counts, merchant numbers or payer numbers for UKPI since its June 2026 launch. The FCA's December 2025 assessment identified access and implementation, pricing, and consumer usage as the principal early determinants of cVRP growth — all three remain open questions rather than settled facts.

The adoption test: coverage, pricing and interoperability

Industry participants told the FCA and PSR that average current-account coverage of at least 75% would likely be needed for cVRP services to reach scale. That is an industry estimate reported by regulators, not a regulatory threshold, and no source here confirms any commercial scheme has reached it. HM Treasury's July 2026 consultation echoed the underlying point: widespread VRP availability depends on PISPs reaching a sufficient proportion of accounts through account servicing payment service providers (ASPSPs) — in practice, enough banks need to connect.

Treasury's consultation proposed a statutory right allowing a PISP to lodge a mandate for a series of transactions, but stopped short of giving the FCA an immediate power to compel banks to join a specific commercial scheme such as UKPI. Participation therefore remains substantially voluntary at this stage, which leaves open the possibility that bank coverage builds slowly, or unevenly between schemes.

Pricing has already drawn regulatory attention. OBL's pre-launch proposal for UKPI contemplated an access fee of 3p to 6p per payment, capped at 6p while the market became established; the final live tariff was not established in the sources reviewed. The FCA and PSR said on 20 January 2026 that they would not, at that stage, prioritise a Competition Act 1998 investigation into UKPI's proposed centralised access-fee model. That is an enforcement-priority decision, not a finding that the pricing model complies with competition law, and it should not be read as clearance.

Even the scale of UKPI's own backing is not entirely consistent across public sources: OBL's next-steps document refers to 32 industry funders behind the scheme's operator, while the FCA's own 2025 progress page refers to a company formed by 31 firms. The sources do not explain the discrepancy, which may simply reflect membership changing over time, but it is a reminder that even basic facts about who stands behind UKPI are not fully settled in public documents.

Consumer protection and control

Readers considering a recurring Pay by Bank arrangement should understand that it is not the same product as Direct Debit, even though it can look similar at the point of signing up. Payment-services law may give rights in cases of unauthorised or incorrectly executed payments, but the sources reviewed do not establish a blanket refund guarantee equivalent to the Direct Debit Guarantee applying to all cVRP transactions. The FCA and PSR's December 2025 assessment described consumer protection for cVRP as still being developed and monitored, rather than finalised. Anyone agreeing to a recurring mandate is authorising their bank to let a regulated PISP initiate payments to a beneficiary within the amount, timing and other limits set out in that mandate, and should check the specific mandate terms published by their bank and payment provider, alongside the FCA's published rules on payment services, to understand how to view, limit, pause or cancel it before relying on it.

What to watch next

The clearest way to track genuine adoption, rather than headline volume, is to watch for independently reported UKPI production transaction figures, bank-by-bank coverage data, and the final outcome of HM Treasury's consultation on modernising payment-services regulation, published 14 July 2026. OBL's own statistics pages and the FCA and PSR's future delivery updates are the primary places that will confirm whether recurring Pay by Bank moves from its current limited, lower-risk scope into a mainstream alternative for subscriptions and repeat purchases, or remains a narrower addition to the UK's payments landscape.