Bank of America today announced its latest online payment solution called Pay by Bank. Launched in conjunction with Banked Ltd., this new feature allows customers of e-commerce companies, initially in the UK, to pay directly from their bank account. Pay by Bank transactions, which are based on the concept of Open Banking, take place in real-time and require no credit or debit card details. This makes online checkout simpler, faster and more secure.
How Pay by Bank works
- A customer adds an item to their online shopping cart and proceeds to the checkout page.
- They select the “Pay by Bank” payment option and then their own personal bank from the menu.
- To authenticate payment, they simply validate using their existing login credentials through their online banking platform.
- Once authenticated, the payment is sent directly from the customer’s bank to the company’s account.
- The customer is returned to the checkout page and the transaction is complete.
“The launch of Pay by Bank is part of our continual cycle of technology investment that helps us to keep clients at the cutting edge,” said Matthew Davies, co-head of Global Corporate GTS Sales and head of GTS EMEA at Bank of America. “The solution will support clients with creating a better experience for their own customers and help set them apart from their competitors.”
Key benefits of Pay by Bank
- Reduction of customer data storage – since a card is not required and it is an online ‘account to account’ payment, companies do not need to obtain and store customer card data.
- Streamlined reconciliation – incoming payments are added to a company’s receivables, so they can view everything together in one place.
- Straightforward connectivity – easy to set up by connecting it to a company’s existing treasury system using APIs.
- Security – leverages the customer’s bank authentication network.
- Cost effective –avoids card processing fees.
“The breadth and scale of our technology development comes from sustained strategic investment. We are proud to launch Pay by Bank and continue supporting clients with tools that can have a positive impact on their business,” said Andrew McKibben, International head of Technology & Operations at Bank of America.
The solution is currently available in the United Kingdom. Subsequent roll-outs will occur in other countries and regions in the near future.