# Variable Recurring Payments (VRP)

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](https://token.io/blog/bringing-vrp-to-life).

Token.io's VRP functionality consists of two main parts:

- [Consent set up](#Consent) - 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) - 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.

## Sweeping and commercial VRP

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

Sweeping VRP is defined as the movement of a user's own funds between the user's own accounts.

The [OBIE VRP Proposition](https://standards.openbanking.org.uk/get-started/propositions/p26/) defines VRP transactions as 'sweeping', on a high level, when they meet the following criteria:

1. The source account needs to be a current account
2. 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
3. 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](https://standards.openbanking.org.uk/get-started/propositions/p26/), the [CMA’s March 2022 letter to the OBIE](https://assets.publishing.service.gov.uk/media/622ef71fd3bf7f5a86be8fa4/Sweeping_clarification_letter_to_be_sent_14_March_2022__.pdf) and the [Q&As document](https://www.openbanking.org.uk/wp-content/uploads/VRP-QandAs.pdf) 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

Commercial VRP refers to any use of VRP functionality that lies outside the definition of sweeping. This can work 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)


### Schemes

br
##### cVRP Wave 1 (UK)

br

Wave 1 of Commercial Variable Recurring Payments (cVRP) in the UK represents the first phase of an industry-wide rollout designed to enable regulated, consent-driven recurring payments via Open Banking. Led by the UK Payments Initiative (UKPI) and aligned with regulatory expectations. Wave 1 focuses on a defined set of use cases - such as government services, regulated financial services, utilities, rail, and charities - where there is clear consumer benefit and lower risk.

br
br

The objective is to establish a scalable and trusted foundation for cVRP adoption, improving payment flexibility, transparency, and control for users, before broader expansion in future waves.

br
br
| Use cases & criteria | Examples |
|  --- | --- |
| **Government services** - Payment to departments, agencies, public bodies and local authorities designated by the GovernmentExcludes retail purchases and non-public sector outsourced third party providers | **Local services** e.g. council tax, parking, social care, housing, waste collection, sport, planning permission, tolls  **Cultural interests** e.g. tourist attractions, museums, institutes, libraries **Other** - e.g. fines, education |
| **Regulated financial services** - Emoney accounts (FCA-authorised and me-to-me or me-to-family only), FSCS-eligible products & mortgages from providers regulated by FCA, Pension schemes granted master trust authorisation by TPR  *Excludes post-purchase payment method change and automatic forwarding* | Emoney accounts, insurance, investments, mortgages, pensions |
| **Regulated utilities** - Ofgem, Ofwat, Ofcom & other regulated companies | Electricity, water, gas, broadband, fixed phone lines, mobile phone contracts |


If you have any feedback about the developer documentation, please contact [devdocs@token.io](mailto:devdocs@token.io)