Despite the UK’s early leadership in real-time payment infrastructure, A2A payments (account-to-account) have failed to gain traction for everyday consumer purchases.
Why A2A payments have stalled
While peer-to-peer (P2P) bank transfers are now a mainstay – used by 85% of UK consumers – A2A consumer-to-business (C2B) payments remain marginal, accounting for just 2% of total transaction value and around 7% in ecommerce.
This underperformance stands in stark contrast to several European peers, where A2A payment adoption has surged.
So why is the UK lagging behind?
A2A payments
The introduction of the Faster Payments System in 2008 and Open Banking in 2017 sparked hopes that A2A payments would eventually rival card usage.
Technically, they offer compelling benefits: near-instant settlement, lower fees for merchants, and increased transparency.
For businesses, this could mean faster cash flow and reduced reliance on costly card networks.
For consumers, the rails are already familiar through P2P use – suggesting the infrastructure and user behaviour are largely in place.
Core Issue is Economic
Yet the core issue is not technical; it’s economic.
The key players in the payments ecosystem – banks, payment service providers (PSPs), and card networks – lack the commercial incentives to drive A2A adoption for retail transactions.
A2A payments threaten their core revenue streams: interchange fees and processing charges on card transactions.
In the UK, interchange accounts for around 10% of personal current account income for traditional banks, and more than 30% for digital banks such as Monzo and Revolut.
For PSPs and acquirers, card payments deliver 2–3x more revenue than equivalent A2A transactions.
Moreover, consumer inertia is proving difficult to shift.
In surveys, UK consumers consistently rate cards and digital wallets more favourably than A2A options, citing convenience, familiarity, and perceived security.
Many say they see “no reason to switch” from cards, particularly when mobile wallets like Apple Pay or Google Pay make card use effortless.
Concerns about sharing bank details outside of a banking environment further dampen enthusiasm.
Fraud Risk?
While fraud risk is often mentioned, this too has diminished as a barrier.
Protections such as the APP voluntary code and the 2024 Reimbursement Rules have brought A2A security closer to card standards.
Still, consumers don’t perceive the difference – and without visible benefits, they have little reason to change payment habits.
The lesson from successful A2A rollouts in other markets is clear: change requires a combination of trust, incentives, and aligned economic interests.
In Sweden, Denmark, and Switzerland, solutions like Swish, MobilePay, and Twint gained consumer trust through P2P use before moving into retail payments.
Their success hinged not just on user experience, but on business models that rewarded at least one part of the ecosystem – whether banks, PSPs, or merchants – for promoting the service.
For A2A payments to flourish in the UK’s consumer space, the entire value chain must be activated.
That means developing monetisation models that provide clear benefits for ecosystem participants, while also offering consumers compelling reasons to try – and stick with – new payment methods.
Without that alignment, A2A consumer payments in the UK will remain a promise unfulfilled.
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