Amazon has launched Pay by Bank, a new service which allows customers to pay for purchases directly from their UK bank accounts.

The online retail giant said the Open Banking-powered service avoids the need to enter or store card details by establishing a secure connection between customers and their existing banks.

Security is maintained through the customer’s own banking app, using PIN verification or biometric authentication, which Amazon said helps protect customers’ financial information and provides them with direct control over each transaction.

The service is currently available for retail purchases, with it set to be rolled out for Prime membership soon.

Additionally, Amazon said the service also offers more efficiency when processing refunds, as funds are returned to customer bank accounts within minutes after the company confirms receipt of returned items.

Since Pay by Bank relies on a direct connection to bank accounts rather than relying on physical cards with expiration dates, Amazon said that its customers will not need to provide or update payment details.

The retailer said the introduction of Pay by Bank offers customers convenience aligned with their modern lifestyles and digital banking preferences.

All purchases made using Pay by Bank are covered by Amazon's A-to-Z Guarantee, which protects customers if items do not arrive or match the description, as well as its standard return and refund policies.

Amazon added that customers using Pay by Bank also have generous protections available to them for up to 13 months under the UK Payment Services Regulations.

The introduction of Pay by Bank supports the UK's National Payment Vision framework which encourages the adoption of account-to-account (A2A) payments in e-commerce to foster more efficient, secure, and competitive payment options for consumers and businesses.

Jonathan Boumphrey, country manager for UK & Ireland at Amazon, said the service is part of the company’s aim to improve the shopping experience and provide more ways to pay.

“The streamlined setup process takes just seconds, with customers selecting their bank from a list that includes more than 99 per cent of UK banks,” he added. “Pay by Bank also provides a checkout experience that customers will find familiar if they use mobile banking apps, but with the added advantage of expedited refunds and permanent payment credentials.”

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