The Competition and Markets Authority (CMA) has pushing back the introduction of variable recurring payments (VRPs) as the mechanism for implementing sweeping by six months.

Sweeping is the automatic transfer of money between a customer’s own accounts, for example, moving excess funds into a separate savings account or using them to repay a loan or overdraft account. VRPs allow customers to connect authorised payments providers to their bank account so that they can make payments on the customer’s behalf within agreed parameters.

In July, the UK watchdog gave nine major UK banks permission to use VRPs - giving them six months to implement the payments method.

On Monday, the regulator said that it was extending the deadline because most of the UK's largest banks are unlikely to meet the 31 January 2022 deadline.

The CMA wrote a letter to the Open Banking Implementation Entity (OBIE) agreeing with the organisation that there should be a revised timescale for the introduction of VRPs for sweeping services.

The authority's initial decision to greenlight the VRP roll out followed a recommendation by the OBIE in January.

“Delivery of the VRP standard for sweeping is a key outstanding item in the final approved Roadmap which the CMA considers to be a critical part of the future development of the Open Banking ecosystem,” wrote the authority.

However it said that as set out by the OBIE, most of the banks do not have "a realistic prospect of meeting the target" of implementing VRPs for sweeping by the original deadline.

The CMA has backed a number of alternative proposals from the OBIE.

According to these proposals, the nine largest UK banks will now need to share a detailed delivery plan for full capability with the organisation by January next year, be ready to start TPP testing and validation in the first quarter of next year, and have had successfully completed testing of the VRP standard in a live, controlled environment by TPPs by July 2022 so the firms are ready to progress general availability of the standard.

Share Story: