Another debit card alternative mobile solutions was launched in the UK, this time with HSBC as announced by Finextra. This is another example of a Pay by Bank application provided by VocaLink. The digital debit can be used to pay for purchases directly from a checking account (current account) without the use of the card network rails. In the U.S., there is decoupled debit which is similar in concept but different in its operation. Decouple debit is offered by merchants as a way to save processing costs by avoiding the card networks and as a platform to pair payments together with loyalty. Pay by Bank is a bank issued solution that utilizes the real time payment rails:
Rajiv Garodia, Managing Director of Pay by Bank app, commented; “We’re delighted to formally welcome HSBC and first direct on board as they begin integration of Pay by Bank app into their mobile banking apps. We now have six of the UK’s biggest financial institutions, alongside a growing number of retailers and merchant acquirers, committed to delivering Pay by Bank app to their customers. This widespread support will usher in a new era of ‘digital debit’ mobile payments using Pay by Bank app, an entirely secure way to pay and be paid.”
Paul Stoddart, Deputy CEO of VocaLink, added, “Pay by Bank app is a transformational service responding to customer demand for fast, secure and convenient payments via mobile. We are excited to be bringing Pay by Bank app to both HSBC and first direct customers
Overview by Sarah Grotta, Director, Debit Advisory Service at Mercator Advisory Group
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