HM Treasury's Payments Forward Plan (February 2026) outlines a 3-year regulatory roadmap for how policymakers will support the realisation of the ambitious National Payments Vision — including enabling account-to-account (A2A) payments as a ubiquitous payment method, presenting a genuine alternative to traditional payment methods like cards.
What is the Payments Forward Plan?
The Plan unites the United Kingdom’s HM Treasury, Bank of England, FCA, and PSR efforts to deliver a trusted, innovative payments ecosystem emphasising consumer choice and protection. It focuses on streamlining regulations, upgrading infrastructure, and encouraging competition through the development of A2A payments.
The Plan charts a clear 3-year roadmap for how policymarkers will support the realisation of the ambitious National Payments Vision — with A2A payments front and centre.
It outlines 4 pivotal 2026–2027 milestones for A2A payments and open banking:
Q1 2026 brings the first live Commercial Variable Recurring Payments under the industry-led UK Payments Initiative (UKPI) scheme, of which Token.io is a founding member.
In Q4 2026, a new Data (Use and Access) Act Statutory Instrument will be laid before Parliament to give the FCA the necessary powers to oversee the future open banking ecosystem (including commercial schemes and cVRP for ecommerce)
By April 2026, an organisation will be selected to take forward the establishment of a “Future Entity” central standards body for Open Banking
By Q1 2027, the FCA will issue a policy statement, supporting a long-term regulatory framework for open banking in the UK
The Plan doesn't hide it: this is a regulatory roadmap aiming to make open-banking enabled A2A payments ubiquitous — providing essential payment choice for UK consumers & businesses.
At Token.io, we're reading this as the definitive signal that 2026 is the window for payment service providers, fintechs and merchants to prepare for a fundamental shift in the UK payments landscape.
What is the National Payments Vision?
The National Payments Vision (NPV) provides high-level strategic goals for UK payments, and aims to position the UK as a global payments leader through innovation.
Its goals are to clear regulatory congestion, provide clarity on priorities and the long-term direction for the UK’s payment sector, boost UK fintech competitiveness, and strengthen the foundations required to deliver world-leading retail payments.
The NPV also recognises the vital role of open banking in delivering seamless A2A payments that will drive competition and ensure consumers and businesses have a genuine choice of payment methods to meet their needs.
How are the Payments Forward Plan and National Payments Vision Different?
The Payments Forward Plan provides a regulatory roadmap for how policymakers will support the realisation of the government's National Payments Vision (NPV). It provides a sequenced, three-year regulatory roadmap for payments initiatives. Published by the Payments Vision Delivery Committee (PVDC) — chaired by HM Treasury with Bank of England, FCA, and PSR members — it translates NPV's high-level ambitions for a trusted, innovative payment ecosystem into coordinated actions and infrastructure upgrades.
National Payments Vision
Scope: High-level strategic principles
Focus: Innovation, competition goals
Timeline: Long-term direction
Payments Forward Plan
Scope: Detailed regulatory milestones
Focus: Coordinated actions by HMT, BoE, FCA, PSR
Timeline: 3-year plan
What does the Payments Forward Plan say about A2A payments?
Ensuring account-to-account (A2A) payments become ubiquitous across the UK is a core National Payments Vision (NPV) objective, with the Payments Forward Plan delivering the regulatory roadmap to make it happen.
Specific Plan commitments related to A2A payments and open banking include:
Q1 2026: First live Commercial Variable Recurring Payments under the industry-led UK Payments Initiative (UKPI) scheme
Q4 2026: New Data (Use and Access) Act Statutory Instrument laid before Parliament to give the FCA the necessary powers to oversee the future open banking ecosystem
April 2026: An organisation will be selected to take forward the establishment of a “Future Entity” central standards body for Open Banking
Q1 2027: The FCA will issue a policy statement, supporting a long-term regulatory framework for open banking in the UK
What is the UK Payments Initiative (UKPI)?
The United Kingdom Payments Initiative (UKPI) is an industry-led company, established under the stewardship of the Financial Conduct Authority (FCA), to own and operate a commercial scheme for Variable Recurring Payments (VRP), which will drive the next phase of open banking and Pay by Bank adoption across the UK.
Formed by Token.io and 30 other leading firms, the UKPI brings together leading banks, payment providers, and fintech innovators to expand the national rollout of commercial VRP: a transformative alternative to card‑on‑file and direct debit payments. With the UKPI’s first live payments expected in early 2026, the initiative marks a critical step toward giving UK consumers and businesses greater choice in how they pay and get paid.
Token.io’s Chief Product Officer Charles Damen serves on the Board of the UK Payments Initiative.
“Continued success in A2A payments and the development of VRP are critical for driving the UK’s digital innovation and economic growth agenda,” says Charles Damen, Chief Product Officer at Token.io. “VRP is a breakthrough providing consumers and businesses with an innovative and long-awaited alternative for seamless, flexible and competitive e-commerce payments, underpinned by a sustainable commercial model for banks.”
What are Commercial Variable Recurring Payments (CVRP)?
Commercial Variable Recurring Payments (cVRP) are a new way to pay with open banking. These open banking-based payments allow customers to authorise businesses to collect variable amounts directly from their bank accounts at flexible intervals.
They enable merchants to replace card-on-file or Direct Debit for subscriptions, utilities, and e-commerce, with customer-set limits on amount, frequency, and duration.
Key use cases for CVRP:
Bills and subscriptions: Increase on-time payments and gives users more control for electricity, gas, water, telecom and TV bills
Repayments: Eliminates late payments with automated credit card and mortgage payments that settle instantly.
Top-ups: Easy recurring or 1-click deposits to current accounts, pensions, investment and savings accounts
E-commerce: 1-click instant payments for smoother, faster checkouts
Train tickets: Automatically initiate instant bank payments based on events or triggers, like train or tube rides
Government payments: Reliable, automated bank payments for council taxes, social care charges, planning application fees, fines, penalties and housing rent
Key benefits of CVRP:
More user-friendly than direct debit
Settles instantly to improve cashflow
Eliminates late payments, like for bills and subscriptions
Reduces churn with automated, instant bank payments
Substantially lower costs than card-on-file and no chargebacks
What does the Payments Forward Plan say about VRP?
The first live Commercial Variable Recurring Payments (CVRP) transactions under the industry-led UKPI scheme will happen in Q1 2026.
Why do UK businesses need Pay by Bank?
Problem: High payment processing fees
Pay by Bank solution: Account-to-account payments are 2-20x lower cost than alternatives
Commercial impact: Lower payment acceptance costs improve margins
Problem: Delayed settlements (2-5 days)
Pay by Bank solution: Near real-time payment confirmation and settlement
Commercial impact: Faster access to funds and improved working capital
Problem: Fraud risk
Pay by Bank solution: 3x lower fraud rates (Source)
Commercial impact: Lower fraud losses, operational efficiencies
Problem: Chargeback burdens
Pay by Bank solution: No chargebacks — irrevocable transfers
Commercial impact: Operational efficiencies, elimination of fees and penalties improves margins, predictable cashflow
Problem: Checkout drop-off and friction
Pay by Bank solution: Bank-authenticated flow with fewer manual steps
Commercial impact: Higher checkout completion, particularly on mobile journeys
Problem: Complex operational effort managing disputes, card data and PCI scope
Pay by Bank solution: No card numbers stored, no chargebacks, simplified reconciliation
Commercial impact: Reduced operational overhead and lower compliance burden
Why do UK consumers need Pay by Bank?
Problem: Card fraud losses
Pay by Bank solution: Every payment is authenticated with a bank — 3x lower fraud rates
Commercial impact: Greater security: No card details shared; real-time bank verification prevents theft
Problem: Manual and error-prone payment experiences
Pay by Bank solution: Approve payments biometrically on mobile, no manual data entry
Commercial impact: Smoother, more convenient payments
Problem: Data privacy risks
Pay by Bank solution: Sensitive card and personal details are never stored or shared by merchants
Commercial impact: Privacy gains: Reduced breach exposure; full consent over data sharing
Problem: Uncontrolled recurring charges
Pay by Bank solution: Coming soon: Consent-based Variable Recurring Payments (VRP)
Commercial impact: Budget control: Set spending limits, pause/skip payments easily vs. rigid Direct Debits
What is Token.io’s role in the UK payments landscape?
Token.io plays a foundational role in the UK’s open banking and account-to-account (A2A) payments ecosystem, both as an early pioneer and as one of the main enablers of Pay by Bank at scale today.
In 2018, Token.io completed the UK’s first end-to-end open banking-enabled payment via a public bank API, marking the first licensed PISP transaction confirmed by the Open Banking Implementation Entity and signalling the start of API-enabled payments in the UK. Since then, Token.io has focused exclusively on A2A payment infrastructure, using open banking connectivity to allow banks, PSPs, gateways and large merchants to initiate direct bank payments that lower costs, improve security and deliver smoother digital payment experiences. Today, Token.io is widely recognised as a leading A2A infrastructure provider for financial institutions and payment companies in the UK and Europe, with broad, deep connectivity across hundreds of millions of bank accounts.
Through this infrastructure, Token.io powers Pay by Bank and other A2A payment propositions for a blue‑chip roster of institutions in the UK payments landscape, including HSBC, Santander, Global Payments and ACI Worldwide.