What Are A2A Payment Solutions?
A2A payment solutions allow money to move directly between bank accounts. No middlemen like card networks or e-wallets are involved. This makes payments faster, cheaper, and more secure.
Businesses and consumers benefit from instant bank transfers, lower fees, and a smoother checkout process. A2A payments work for online shopping, bill payments, subscriptions, and more.
With the rise of open banking, A2A payment solutions are becoming a serious alternative to traditional payment methods.
Article Contents
How A2A Payments Work
A2A payments transfer funds using direct bank connections. There are two main types: push payments, when the payer sends money manually, and pull payments, when the payee requests the payment and the payer authorises.
Unlike card payments, A2A transactions don’t require card networks. Instead, they use existing banking infrastructure or open banking APIs to move money efficiently.
Types of A2A Payment Solutions
As a merchant, you have several ways to add A2A payments to your payment system.
Solution 1: Open Banking Payments
Partner with an open banking provider to accept pay-by-bank transactions. These A2A payments bypass card networks, using bank APIs for direct, secure transfers.
Customers authorise payments via their bank, without entering details manually. These payments are PSD2 regulated, ensure bank-level security, and also more cost-efficient. Businesses can also send invoices with embedded pay-by-bank links.
Solution 2: Direct Debits (UK Only)
Ideal for subscriptions, memberships, and recurring bills, direct debits allow UK businesses to pull A2A payments directly from customer accounts with prior authorisation.
Managed by the Bacs Payment Scheme, this method ensures payments are taken on agreed dates with advance notice to customers.
The Direct Debit Guarantee protects consumers, offering refunds for errors and the ability to cancel anytime.
Solution 3: Manual Bank Transfers
The least user-friendly option, manual bank transfers require customers to enter sort codes and account numbers manually.
While some businesses still use this method for invoicing, it’s outdated, time-consuming, and prone to delays.
Benefits of A2A Payment Solutions for Businesses
A2A payments offer businesses a cost-effective and efficient alternative to traditional card transactions.
By bypassing card networks, businesses save on processing fees and can pass those savings on to customers.
Payments settle instantly, improving cash flow and liquidity without the delays of card-based transactions.
Additionally, A2A payments eliminate chargebacks, reducing fraud-related disputes and minimising financial losses.
The user experience is also significantly better – especially in case of open banking and direct debits.
With a faster, more straightforward checkout process, customers complete transactions with fewer steps, reducing cart abandonment.
Consumers benefit just as much as businesses. A2A payments operate within a user’s trusted banking app. In the case of open banking payments, they offer convenience, removing the need to enter card details or go through additional verification steps.
Payments process instantly , meaning funds clear without delay. Most importantly, customers maintain better control over their money, authorising each transaction directly and reducing fraud risks.
Use Cases for A2A Payments
Now that we’ve covered how A2A payments work and their key benefits, let’s explore their role in different industries.
- E-commerce: At checkout, customers select “Pay by Bank,” authenticate via their banking app, and complete the purchase instantly. E-commerce merchants can use API to add this payment method to their websites, or use marketplace plugins.
- Subscription Services: Users set up direct debits, allowing businesses to pull A2A payments automatically on billing dates.
- Travel & Hospitality: Like in e-commerce, merchants can integrate pay-by-bank payment method to their checkout.
- Gaming & Digital Goods: Likewise, merchants can integrate the pay-by-bank payment method to their checkout. Many gaming companies are already using this, for example, Wargaming.
- Utilities & Bills: Customers pay rent, telecom, and energy bills through automated direct debits.
Future of A2A Payment Solutions
A2A payments are gaining traction worldwide. Open banking is accelerating their adoption, making direct bank payments easier and more secure.
1. More Merchants Will Adopt A2A Payments
As businesses look to cut costs, many will move away from card payments in favor of A2A solutions.
2. Faster and Smarter Payments
AI-driven automation will make A2A payments even more seamless and reliable.
3. Cross-Border A2A Transactions
International A2A payments will become a reality, reducing reliance on traditional banking rails.
Future of A2A Payments
A2A payments are taking off as open banking makes them faster, safer, and easier to use.
More businesses and consumers are breaking up with cards in favor of pay-by-bank, and with AI and automation improving the process, this shift is only going to accelerate.
Regulatory changes are driving this momentum. For example, the EU’s Instant Payment Regulation (IPR) will require all banks to process euro payments within 10 seconds, 24/7, starting in 2025 – eliminating delays and pushing banks to modernise their systems.
PSD3, expected by 2026, will further improve open banking by requiring stronger, more reliable APIs.
The impact is already clear. In the UK, pay-by-bank payments skyrocketed from 320,000 in 2018 to 224 million in 2024, with adoption among small businesses and digital consumers rapidly growing.
With the global market projected to reach $164.8 billion by 2032, this year marks a turning point – faster payments, fewer intermediaries, and lower fees are set to reshape the way money moves.
