NatWest leverages open banking to cut transaction fees by 25%

The UK’s NatWest bank has launched a new service that will let consumers pay online merchants directly from their bank accounts, “saving merchants at least 25% of card processing costs”.

Natwest logo“The service removes the need to input long card numbers; customers can simply select the payment type and their bank during the checkout process, at which point they will be redirected to their own bank’s online banking page or mobile app,” NatWest says.

“The customer will then log in with Touch ID or their standard password before the process will complete automatically — cutting the times involved from minutes to just seconds.

“This new payment method will benefit both customers and merchants,” the bank adds.

“For customers they can check their balance before making a payment and therefore avoid any surprise transactions or overdraft fees, and they will be able to make payments sharing only a minimal amount of data.

“The open banking technology will enable bank to bank transfers using faster payments delivering immediate settlement for merchants. The new technology will also remove the need for card carriers saving merchants at least 25% of card processing costs.”

In an initial trial conducted with Carphone Warehouse, more than half of customers chose to use the new NatWest service rather than using their card, NatWest revealed last year.