GDS Plans To Implement Open Banking Feature For GOV.UK Pay

The Government Digital Service (GDS) has announced plans to introduce an open banking payment feature for GOV.UK Pay. A market notice has been published, signaling the intention to add functionality that will allow payments via application programming interfaces (APIs) connected to banks’ systems.

The notice reveals that GDS is set to allocate up to £49.2 million for this project through a three-year contract, which will start in July this year, with options for two one-year extensions.

GDS Explores Open Banking Integration For GOV.UK Pay

This development follows GDS’s statement that it was exploring ways to integrate open banking into GOV.UK Pay. The move aligns with a broader trend across the public sector, where interest in open banking is increasing. In December last year, the Crown Commercial Service introduced a procurement framework specifically for open banking services.

Open banking allows banks and third-party providers to securely share financial data using APIs. In the UK, this system is governed by Open Banking Ltd, a not-for-profit organization, and is subject to oversight by the Competition and Markets Authority.

The market notice outlines key expectations for the new payment service provider. The selected provider must support open banking payments either independently or in partnership with another company. Users should be able to complete transactions within the GOV.UK Pay platform, except for the step where they authorize payments through their banking apps.

The provider must work with all CMA9 banks, the nine largest in the UK. It must help start payments, give back refunds, and let users stop payments when needed. The provider must also follow the newest open banking rules.

Also, the provider must help GOV.UK Pay with card payment problems. It must also set up and look after service accounts.

GDS Strengthens GOV.UK Pay With New Payment Provider Plans

The system must conduct automated ‘know your customer’ (KYC) and anti-money laundering (AML) checks and send automated event notifications about the onboarding of relying services. GDS expects the new provider to start delivering services by the end of a 12-month onboarding period.

Currently, GOV.UK Pay works with two payment service providers. Worldpay handles transactions for central government services, while Stripe supports payments for local authorities, police, and government-affiliated charities.

Since its launch, GOV.UK Pay has been used by more than 1,000 public sector services. The platform has processed over 94 million transactions, totaling £6 billion.

The Government Digital Service (GDS) is a division of the United Kingdom’s Department for Science, Innovation and Technology. Its primary role is to enhance the delivery of online public services.