What is a variable recurring payment (VRP)?

A VRP is an open banking payment where the customer gives one consent, in their banking app, for a provider to make repeated payments of varying amounts to a payee. Each payment must stay within the limits the customer set, and the consent can be revoked at any time.

How it works

• The customer sets up the consent in their bank, choosing limits such as a maximum per payment, per month or a validity period.
• A payment initiation provider then triggers payments within those limits, without asking the customer each time.
• Payments are sent as account-to-account transfers, usually instant.
• The customer sees and manages the consent in their banking app.

Why it differs from other recurring methods

Unlike direct debit, the payment is pushed from the customer's account through open banking, settles in seconds and is confirmed immediately. Unlike cards, there is no card number to expire or be compromised.

Where it is used

The UK has led, first with sweeping between a person's own accounts, then with commercial VRP for some sectors. Other markets are developing similar services.

What it means for payment operators

For your merchants with subscriptions or variable bills, VRP is a possible alternative to cards and direct debit where available. Recurring payment infrastructure that can use several rails lets them add it without rebuilding billing.