cVRPs: The strategic advantage for Wave 1 industries
Last editedMar 20261 min read
Understand the innovative approaches to cVRP for Wave 1 industries
Commercial VRPs (Variable Recurring Payments) represent a pivotal shift for businesses built on recurring revenue. Powered by open banking, businesses can collect recurring payments with more automation, flexibility, and speed than ever before.
While the core benefits are powerful, this new technology can act as a catalyst for innovation for businesses in Wave 1 sectors. This new method allows you to unlock novel approaches to how you collect payments and engage with your customers.
Wave 1 industries and their commonalities
The Financial Conduct Authority (FCA) and the Payment Systems Regulator (PSR), in collaboration with the industry, are leading a deliberate, phased rollout for commercial VRPs.
There are two phases for the rollout – Wave 1 and Wave 2. Wave 1 includes regulated, ‘low-risk’ sectors:
Utilities, including energy and telecoms
Financial services
Insurance
Central and local government
Charities
Rail and travel
These types of businesses share three key commonalities:
Variable billing is core: Monthly amounts generally change based on usage.
Trust-based relationships: Customers expect control but value convenience.
High compliance needs: Authorised payment agreements are often preferable to storing card details.
Commercial VRPs are a catalyst for innovation
Common benefits like lower fees and faster settlement are correct, but they understate the level of change. This new method turns your collections process into a vehicle for innovation.
| Sector | Core use case | The commercial VRP unlock |
|---|---|---|
| Energy, utilities and telecoms | Variable monthly bills | Accurate collections: Collect what customers actually owe each month based on usage. Stop relying on estimates or manual adjustments. |
| Financial services | Loans and investments | Smart repayment logic: Use automated top-ups and debt repayments that flex according to real-time account balances to minimise payment failures. |
| Local and central government | Council tax and fines | Flexible payment plans: Let residents repay council tax or fines via variable instalments timed to their salary payments. |
| Charities | Recurring donations | More money for good causes: Significantly reduce collection costs by moving away from cards. Supporters can adjust their gift instantly through their banking app. |
| Rail and travel | Season tickets and PAYG | Frictionless fare capping: Replace card authorisation with direct account-to-account settlement for weekly caps and automatic renewals. |
| Insurance | Premiums and policies | Usage-based premiums: Support ‘pay-as-you-drive’ policies where premiums vary monthly based on real-time data. |
Take the early adopter advantage
Ultimately, commercial VRPs should not just be seen as a new way to pay but as a strategic business advantage. By eliminating the trade-offs of traditional payments, you can finally align billing cycles with real-time liquidity and consumer preferences.
The technology is here for Wave 1 businesses. To take advantage at the earliest opportunity, get in touch with the GoCardless team today.
Work with the team that gets payments right
15 years perfecting recurring payments for over 100,000 businesses.
First to process VRP transactions in 2019.
Payment intelligence built-in with balance checks and automatic retries.
Proven at scale: We process 50 billion plus annually with 99.95% uptime.
