TrueLayer has launched Bank on File in the UK, starting with Trading 212, IG Group, InvestEngine and East Lothian Housing Association.
The launch marks the first live payments under the UK Payments Initiative, which brings together the Financial Conduct Authority and more than 30 banks and fintechs.
Bank on File lets consumers authorise recurring payments directly from their bank account, rather than relying on cards stored by merchants or on direct debit. It is aimed at regular payments, such as investment contributions and rent, and live transactions have already occurred.
The launch extends pay-by-bank services beyond one-off purchases, which have been the main use of open banking payments so far. Customers set up the arrangement by choosing their bank and authorising consent through biometric checks such as facial recognition or a fingerprint scan.
Users agree in advance on the amount and timing of payments and can cancel recurring payments at any time. The service is being rolled out to UK customers in phases through June.
The initial users indicate where TrueLayer sees early demand. Trading 212 plans to use the payment method for account funding and recurring investments, while IG Group and InvestEngine will apply it to recurring deposits and investment journeys. East Lothian Housing Association will use it for regular rent payments.
TrueLayer is positioning the service as an alternative to card-on-file billing and direct debit. Card-based recurring payments can fail when a card expires, is lost, or is compromised by fraud, while direct debit can offer less flexibility in payment controls.
The company cited Financial Conduct Authority figures showing that 7.4 million UK consumers feel burdened by bills and credit commitments, while 5.5 million have missed a payment in the past six months. It added that card payment failure rates for subscription billing run at 5% to 10%, with failed payments costing subscription businesses an estimated 9% of annual revenue.
The launch also gives the UK Payments Initiative an early commercial use case. The regulator and industry participants formed the scheme to expand pay-by-bank services beyond current regulatory requirements.
For TrueLayer, the move is part of a broader push to widen the role of bank-based payments in digital commerce. Founded in London in 2016, the company operates across 22 countries and says more than 20 million users have used its network.
"For decades, digital commerce has relied on card-on-file payments. Pay by Bank proved there was a better way to pay, but until now it was limited to one-off transactions. Bank on File changes that. Consumers can now securely authorise recurring payments directly from their bank account, with full visibility, control and the ability to cancel at any time. Launching with four leading financial services providers shows that Bank on File is now ready to compete with card-on-file for modern commerce," Francesco Simoneschi, Chief Executive Officer and Co-founder of TrueLayer, said.
Early adopters
Trading 212 said the payment option could help users automate regular investing from a bank account without having to enter card details. The brokerage is among the first firms to deploy the product live.
"At Trading 212, our mission is to help people build wealth every day - and that means removing friction at every step. Bank on File does exactly that. Our customers can now automate their investments directly from their bank account - whether that's into a diversified portfolio or a single stock. We're proud to be one of the first platforms to bring this to market," Marc Najjar, Head of Strategic Operations at Trading 212, said.
IG Group also linked the system to regular investing behaviour.
"Investing works best when it becomes a habit. That's why making it simple for customers to fund their accounts and automate contributions is so important. Bank on File enables customers to securely connect their bank account and set up recurring investments in just a few clicks, creating a faster and more seamless investing experience. We're excited to be among the first firms helping bring this new payment capability to market," said Burke.
InvestEngine described the change in similar terms, focusing on recurring account funding and customer retention over time.
"Regular investing is one of the most powerful ways to build wealth over time. The easier it is for customers to fund their accounts and automate contributions, the more likely they are to stay invested for the long term. Bank on File removes friction from that process, creating a simple, secure way for customers to invest directly from their bank account," said Ben Jenkins, CPO at InvestEngine.
In housing, East Lothian Housing Association said the approach gives tenants more control and immediate confirmation when rent has been paid.
"We've partnered with True Layer right from the earliest days of Open Banking and we're delighted that real time, fully automated, Pay by Bank payments are now a reality, making rent payment quicker, simpler, and handing control over payments to our tenants. Tailoring individual payments to each tenant's personal circumstances creates a unique user experience, whilst the instant settlement means tenants can see their rent is paid straight away, no more waiting for payments to process or worrying that a payment has been missed," Martin Pollhammer, CE at ELHA said.