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Is Open Banking the biggest change in banking for a decade?

That was the question posed to the CEOs of Plum, Zopa, Starling Bank, and GoCardless last week, by Balderton Capital’s Rob Moffat at our panel discussion on the impact of Open Banking.

In this blog, we’ll cover the highlights of that discussion; including our panellists views on the current state of Open Banking and the opportunities for fintechs, as well as their predictions on what’s to come.

The current state of Open Banking

Services enabled by the Account Information Service (AIS) are the first off the blocks, though most license applications to date have come from fintechs in the lending space.

Zopa is one of those businesses. While, like many fintechs it has historically used Screen Scraping, new regulatory technical standards in Europe will stop that practice by September 2019.

So how are businesses like Zopa planning to use Open Banking APIs?

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The impact of Open Banking on consumers
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5 Direct Debit myths debunked

We debunk the most common myths about Direct Debit

It’s been a British institution since the 1960s, but in the last half century, Direct Debit has gone from clunky and paper-based, to sleek, slick and simple.

In this post, we’ll clear up some common misconceptions around Direct Debit, so you’re up to date on the UK’s most popular method for collecting recurring payments.

Myth 1: Gaining access to Direct Debit is difficult

If you want to start processing payments by Direct Debit today, you can choose direct or indirect access. In the past, access to Direct Debit was only available directly, through your bank. The process was, and in some cases remains, slow. It also requires significant effort and expense for the person applying – in setup and ongoing management.

For very large businesses with high transaction volumes, who can meet the revenue criteria of banks and don’t mind hiring people to manage the process (and sourcing their own software), direct access may still be the preferred route, since it enables them to negotiate the lowest transaction fees.

The other way to access Direct Debit is ‘indirectly’ via a third party provider like GoCardless. These providers manage the Direct Debit process with the bank on your behalf. They are an attractive option for many businesses; they can provide an online plug-in-and-go service, significantly reducing setup time and cost and ongoing management and admin. And choosing a third party provider doesn’t necessarily mean high transaction costs (see myth 5).

Myth 2: Direct Debit is unsafe

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GrowFactor save 2 days a month using GoCardless
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FAQ Friday – Can you pay by credit or debit card through GoCardless?

One of the questions we often get asked is whether or not we process credit or debit card payments.

GoCardless specialises in bank to bank payments using Direct Debit schemes around the world, meaning you can’t use us to take payments via card.

This FAQ Friday, we hear from GoCardless’ Director of Business Operations and Strategy, Pranav, as he talks us through the three mains reasons why this is and why we believe this is better for our customers.

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Conquer recurring payments
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GoCardless & Xero: A beautiful business love story

Finding a great match isn’t easy. You have to have a good connection. It helps if your values align. You should bring out the best in each other. You need to see a future together. And ultimately, when you know, you know.

When GoCardless launched its first integration with small business cloud accounting platform Xero a few years ago, we knew it was the start of something big. We spent time making a great connection (with a seamless user experience) and we shared the same belief in beautiful business, in streamlining admin and giving small businesses more time back to focus on growth.

And when you put us together, we made more: our users were paid on time, while avoiding manual reconciliation and reducing accounting errors. They could manage payments and billing in once place, saving hours of time on admin.

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GoCardless for Xero – Australia
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FAQ Friday – Why do some Direct Debit payments fail and what can you do about it?

Payment failure rates with Direct Debit are low compared to other payment methods (typically <3% with Direct Debit compared to 5-15% with cards).

Though Direct Debit is one of the most reliable payment methods, transactions can still fail. This week on FAQ Friday, Product Marketing Manager, Ross, explains what GoCardless transaction data tells us about payment failures. He reveals the two most common reasons for Direct Debit payment failures and what you can do about them.

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More about GoCardless’ failure rates
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