Variable Recurring Payments (VRP) enable a user to grant long-held consents to Payment Initiation Service Providers (PISP) to initiate future payments from users' bank accounts without users needing to authenticate each payment with the bank. VRP facilitates innovation in payment experiences, the creation of new types of financial services, and greater levels of consumer transparency and control. VRP should not be seen as a use case but rather as the underlying technical functionality upon which use cases can be developed. For more details on the experiences that can be enabled by VRP, see our blog post, Bringing the benefits of Variable Recurring Payments to life.
Token.io's VRP functionality consists of two main parts:
Consent set up - establishment of the long-held consent to allow a TPP to initiate payments on behalf of the user with a set of control parameters.
Payment initiation - initiation of a variable recurring payment adhering to the control parameters of the approved consent.
Token.io's API supports capabilities covering the end-to-end management, execution and monitoring of variable recurring payments. In addition, Token.io offers an out-of-the-box user experience to TPPs to help setup and initiate VRP payments.
The Token.io API supports the VRP OBIE 3.1.10 specification.
Token.io supports both sweeping and commercial (also known as non-sweeping) VRP. As it stands today, there is no technical distinction between sweeping and commercial VRP; the distinction therefore relates not to what the service is, but rather what it is used for.
Sweeping VRP is defined as the movement of a user's own funds between the user's own accounts.
The OBIE VRP Proposition defines VRP transactions as 'sweeping', on a high level, when they meet the following criteria:
The source account needs to be a current account
The destination account is an account into which a domestic payment can be made by the payer’s bank’s direct channel, e.g., savings account, another current account, credit card repayment
The transaction is between two accounts belonging to the same person or legal entity (“me-to-me”).
Further clarifications on what constitutes a sweeping use case can be sought in the OBIE VRP Proposition, the CMA’s March 2022 letter to the OBIE and the Q&As document published in July 2022. Please engage with your Token.io point of contact should you need any support in understanding whether your use case is sweeping or commercial VRP.
Examples of key sweeping VRP use cases include:
Automated (regular and scheduled) top-ups to savings and current accounts.
One-click top-ups to savings and current accounts.
Automated (regular and scheduled) repayments for credit cards.
One-click repayments for credit cards.
Commercial VRP refers to any use of VRP functionality that lies outside the definition of sweeping. This can manifest itself in two ways:
Me-to-me transfer - where the source and destination accounts belong to the same person or legal entity, but where the destination account is a type of account that does not have the features of a current account or is not used as an alternative to a traditional current account
Me-to-them transfer - where the source and destination accounts do not belong to the same person or legal entity. This use of VRP is often for the purpose of paying for goods or services
Examples of commercial VRP use cases include:
One-click ecommerce purchases.
Recurring payments (e.g., utility bill payments, subscription payments, government payments).
Account top-ups (e.g., transfer of funds to an investment account, transfer of funds to any other account that can have a balance, like a mobile phone pay-as-you-go account).
If you have any feedback about the developer documentation, please contact devdocs@token.io