The Bank of America have launched a new feature that could enhance the way customers pay online. Pay by Bank as it’s known will let customers of ecommerce companies, pay directly from their bank account without the need for card details. Is this a step further into an even simpler world of digital payments?
How it works
- A customer adds an item to their online shopping cart and proceeds to the checkout page.
- They select the “Pay by Bank” payment option and then their own personal bank from the menu.
- To authenticate payment, they simply validate using their existing login credentials through their online banking platform.
- Once authenticated, the payment is sent directly from the customer’s bank to the company’s account.
- The customer is returned to the checkout page and the transaction is complete.
The launch of Pay by Bank is part of our continual cycle of technology investment that helps us to keep clients at the cutting edge. The solution will support clients with creating a better experience for their own customers and help set them apart from their competitors.– Matthew Davies, co-head of Global Corporate GTS Sales and head of GTS EMEA at Bank of America
Benefits of Pay by Bank
- Reduction of customer data storage – since a card is not required and it is an online ‘account to account’ payment, companies do not need to obtain and store customer card data.
- Streamlined reconciliation – incoming payments are added to a company’s receivables, so they can view everything together in one place.
- Straightforward connectivity – easy to set up by connecting it to a company’s existing treasury system using APIs.
- Security – leverages the customer’s bank authentication network.
- Cost effective –avoids card processing fees.
The new payment solution will initially roll out in the UK. Subsequent roll-outs will occur in other countries and regions in the near future.