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What is bank pay? Everything you need to know

Chris Hooper
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Last editedMay 20222 min read

Since our inception in 2011, GoCardless has consistently pushed the boundaries on what is possible in the world of payments.

We were first to recognise that a payments system based on plastic credit and debit cards was not fit for purpose for the online world. And we have made it our purpose since then to find better, quicker, smarter, cheaper and more secure ways for people and businesses to pay each other.

Our constantly evolving product suite already takes the pain out of payments for more than 70,000 businesses across the globe, allowing them to focus on what they do best and grow to meet their potential.

But we’re not finished yet. The next chapter in the GoCardless story is perhaps the most exciting yet. 

Put simply, we are going to revolutionise the world of payments completely. 

Before bank pay, businesses would suffer high costs through the number of intermediaries involved in a card transaction and customers would suffer as businesses had no choice but to pass these costs on to them. Having so many intermediaries also led to slower payments and more opportunities for security to be breached. 

But our global bank pay network has consigned this to the past and we can confidently say this is the dawn of a new era in payments - the bank pay era.

Introducing bank pay

Bank pay is the next era of payments - one that is brought to you by our deep expertise in knowing what works, what doesn’t and how businesses of all sizes can take the pain out of payments.

As one of the first and best-known innovators in this space, we have now accumulated more than ten years of experience in building direct bank payments using direct debit and are now utilising new banking APIs and real time payment rails brought about by open banking to transform the way payments happen.

We pioneered the use of direct debit in transforming how organisations collect money and, thanks to open banking, the benefits of paying with your bank account can now be applied to other payment use cases such as making one-off or instant payments. This is the real beauty of bank pay.

As our CEO, Hiroki Takeuchi, explained: “Open banking is going to play a big role in our future, so we’re doubling down on our plans to accelerate in this area and are expanding our vision to become the world’s ‘bank pay’ network. 

“By providing simple and secure direct bank payment solutions, we’ll help businesses and their customers bypass unnecessary intermediaries and pay directly via their bank account”.

What is bank pay?

In its most simplified form, bank pay is making a payment from one bank account directly to another. 

This means of digitally moving money in an integrated and automated fashion is faster and more secure, but there is so much more to it than that.

Bank pay can be used to send payments or collect them, whether that payment is a one-off or a recurring payment. Bank pay can also be used for instant payment or payment scheduled for a defined date.

Collecting and making payments is at the heart of what businesses of all sizes do. For example, an organisation may want to collect one-off payments on its ecommerce store, it may want to collect recurring subscriptions for a service it provides, it may need to pay its supplier invoices regularly and it may need to pay its employees every month. All of this is possible with our global bank pay network.

And, as our customer base can attest, bank pay is what the future of payments will look like.

“Until now, online payments have been constrained by payment methods that were created for an offline world, resulting in high transaction costs and slow payout times,” GoCardless CEO Hiroki Takeuchi has said. “We’ve always believed that bank debit is the best way to collect recurring payments, and open banking is set to make ‘bank pay’ the best way to collect one-time payments too.”

However, we know the payments business and the array of products on display are confusing enough to those unfamiliar with the industry. So, instead of talking about what bank pay is, we prefer to focus on what it can do. 

Discover how bank pay can set your business free from the constraints of traditional payment methods.

Over 70,000 businesses use GoCardless to get paid on time. Learn more about how you can improve payment processing at your business today.

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