The UK's Faster Payments scheme has secured commitments from six fintech firms - including VocaLink, ACI Worldwide and FIS - to develop aggregation services for payment service providers (PSPs) looking to plug into its platform.
Faster Payments currently has 11 members who connect directly to the service, while a further 400 Payment Service Providers access the platform indirectly through a sponsor bank.
However, the upfront costs of being a direct member is too much for some and the sponsor route does not provide the desired real-time 24/7 service. So in December the scheme set out plans for a 'New Access Model' which would see a third way to connect.
The new option is based on fintech vendors providing aggregation services, offering technical access to PSPs by adding to their existing accounting platform technology, or providing a managed solution to either a single or multiple clients.
According to research from Accenture, commissioned by the Faster Payments scheme, this should not only ensure 24/7 real-time payments but also result in lower costs over five years than sponsored access or direct membership for PSPs processing between 1.4 million and 20 million Faster Payments per year.
Meanwhile, fintech firms providing the access could see a potential collective £200 million (Net Present Value) profit, says Accenture. So far six firms - ACI Worldwide, Bottomline Technologies, FIS, Fiserv, Fundtech, and VocaLink - have decided to jump aboard and develop their own aggregation services.
Jeremy Light, MD, Accenture Payment Services, says: "Up until now, some challengers have been caught in a ‘Catch 22’ situation when faced with the decision on how best to offer Faster Payments to their customers. The New Access Model would stimulate a new market for FinTechs while substantially reducing the barriers to entry for FinTechs and making 24/7 access to immediate payments economically attractive at lower volumes."