SlimPay merchants will be able to offer a secure way to set up a direct debit that lets users authenticate and make the initial payment through Open Banking – without having to manually enter their details or leave the merchant’s app or website.
SlimPay helps merchants across Europe to offer subscription payment experiences. By partnering with Tink, SlimPay can now offer Open Banking payments as an alternative way to set up a direct debit. The new solution, SlimCollect, lets users connect their bank account in a few seconds without having to share any sensitive information, since they authenticate directly with their bank. This means a safer payment experience for consumers and a lower compliance burden for merchants.
As one of the first payment platforms to launch SEPA Direct Debit in France, SlimPay has an interest in recurring payments. Now they’re using Open Banking to further simplify subscription payments for merchants across Europe. Choosing Tink as their partner lets SlimPay offer a payment solution across the entire SEPA zone, meaning their merchants can do business in 30+ European markets without the complexity of managing multiple local payment methods.
Direct debits are relatively frictionless once they’ve been set up, but setting one up requires the user to complete a direct debit mandate, as mentioned in the official press release.
That is the moment where Open Banking comes in. By combining PIS and direct debits, SlimPay can improve the direct debit setup process. End-users will make an initial payment through PIS, meaning they’re automatically taken to their banking app to authenticate in real time using biometrics like a fingerprint or Face ID. Once the user connects their bank account they can then be switched over to a direct debit.
SlimPay’s partnership with Tink shows how Open Banking can simplify recurring payments for merchants already. It also points to a future where Open Banking becomes an equally low-cost but more seamless alternative to direct debits altogether, as it offers merchants a secure A2A payments service with which to collect their recurring revenue.
Variable recurring payments (VRP) are a transparent form of a standing order, with the details, date, and parameters of the recurring payments being accessible and identifiable within the allocated banking app. Both the amount and the time frame of the process can be limited and controlled, which would lend itself to the added flexibility of the service.
Implemented by the Competition and Markets Authority (CMA) upon the recommendation of the Open Banking Implementation Entity (OBIE) back in August 2022, VRP could disrupt the current system of billing and its relationship with paytech.
VRPs have been designed to ensure it maintains the central ethos of Open Banking of the customer being in control. They will be able to ask the third-party providers (TPP) to cancel the recurring payments at any time. They will also be able to ask their bank to remove the TPP’s access, as an additional way to cancel.
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