The landscape of digital payments is evolving rapidly, and one of the most promising innovations is ‘Pay by Bank’, a term referring to instant account-to-account (A2A) payments powered by Open Banking.
According to the newly released Yaspa Index 2025, familiarity with this payment method is growing, but consumer understanding remains fragmented.
With over 2,000 UK consumers surveyed, the Yaspa Index provides critical insights into payment behaviours, emerging trends, and the hurdles businesses must overcome to accelerate adoption.
As the payments industry seeks to modernise transactions and enhance financial security, the findings highlight both opportunities and challenges for merchants, fintechs and financial institutions.
Awareness of Pay by Bank: A Work in Progress
One of the standout takeaways from the Yaspa Index is the significant gap in consumer awareness and understanding of Pay by Bank.
While 55% of respondents claimed familiarity with the term, a notable 45% remain unaware – despite the increasing presence of this payment method in online checkouts.
Demographic Insights on Awareness
- Millennials and Gen Z consumers lead adoption, with 69% of Gen Z respondents reporting familiarity with ‘Pay by Bank.’
- Older generations remain less informed, with awareness dropping to 47% among the Silent Generation (born before 1945).
- Geographical variations are notable, with London (61%) showing the highest awareness levels compared to Wales (48%).
- Men (57%) were slightly more familiar with Pay by Bank than women (53%).
- Younger generations, particularly Millennials (60%) and Gen Z (69%), showed higher awareness.
This suggests that targeted education efforts and strategic marketing initiatives could accelerate the mainstream adoption of Pay by Bank, particularly among demographics that have traditionally relied on cards or digital wallets.
Security and Convenience: The Driving Factors
When consumers were asked about their top priorities when selecting a payment method, two factors stood out: security (72%) and ease of use (66%).
These insights reinforce the potential appeal of Pay by Bank, which eliminates the need for manual entry of card details while leveraging the secure infrastructure of banking apps.
However, the research also revealed that consumers tend to choose the most familiar payment options at checkout, meaning that even if Pay by Bank is available, many still default to traditional card payments.
Another key finding from the Yaspa Index is the gradual rise of QR code payments in the UK.
Over the past year, 27% of respondents used QR codes for transactions, with younger generations leading adoption.
While this indicates growing consumer interest in alternative payment methods, it also highlights the need for businesses to provide more education and seamless integration to drive wider adoption.
What This Means for Businesses
For businesses, particularly in e-commerce and iGaming, the Index underscores the need to bridge the education gap to encourage greater adoption of Open Banking-powered payments.
The report highlights two key recommendations:
- Standardising Naming Conventions: The term ‘Pay by Bank’ is gaining traction, but the lack of a consistent industry-wide name creates confusion. By establishing a unified branding strategy, financial providers can enhance recognition and trust among consumers.
- Enhancing Consumer Education: As the adoption of real-time bank payments continues, businesses must actively communicate the benefits of Open Banking – including speed, security and cost savings – to build consumer confidence.
The Yaspa Index 2025 serves as an important benchmark for tracking the rise of Pay by Bank, highlighting what needs to be done to ensure its success in the broader payments ecosystem and is worth a read.
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