What is Sweeping & VRP (variable recurring payment)?
- Sweeping payments allow you to send funds between two bank accounts in your name, (which are the main 9 FCA regulated banks within the U.K, also known as the CMA9)
- As a customer you can only Sweep funds to another bank account you hold in the same name, another way to look at this is both banks accounts need to have exactly the same name
- You can only setup a Sweeping payment via a Third Party Provider also known as a TPP, TPPs use Open Banking APIs to allow customers to make payments and provide consent through these APIs
- Sweeping allows you to provide consent to a TPP to sweep funds from your account upon the account reaching an agreed balance under a specific rule known a parameters, an example of this could be:
"Sweep funds in excess of £100 upon my balance reaching this threshold" therefore, if your balance reached £120, then the Third Party will sweep the excess, in this case £20 to the other account in your name.
VRP (variable recurring payments) is a new payment method that will allow you to pay for recurrent bills (e.g. utilities, subscriptions, loan repayments). VRP will be available at merchant checkout page, offered as an additional payment option above an beyond the most traditional ones (e.g. direct debits, debit card payment, credit card payments). The key advantages on setting up a VRP payment are:
- you will be more in control of your outgoings, by receiving live notifications on processed payments and by seeing all existing mandates in one place
- you can self-serve your needs by setting up or cancelling a mandate in few "finger tips", without anymore a need to spend hours on the phone with a merchant customer centre
