As financial institutions advance their digital transformations, Paylume’s Frederic Barbaix highlights how Request to Pay (RTP) can unlock the full value of payment initiation, overcoming some of the challenges with customer friction.
Payment initiation has long been positioned as a major advantage of open banking, as it can offer faster, more competitive, and user‑friendly payments.
However, many use cases remain hard to deliver.
The primary barrier here is Strong Customer Authentication (SCA), a security component that was introduced as part of the EU’s payment services framework.
The method has been beneficial in reducing fraud but also introduces friction that slows adoption and frustrates both consumers and merchants.
By requiring two independent factors out of knowledge, possession, and/or inherence, it adds steps that can often feel cumbersome, triggering abandoned transactions, especially for low‑value or recurring payments.
Early European Banking Authority assessments also warned that a disproportionate application of SCA could undermine checkout efficiency and further increase abandonment, calling its use “disproportionate” and introducing “undue friction”.
In e‑commerce, this can mean customers having to switch between merchant and bank interfaces or even devices, while for third‑party providers (TPPs), the challenges are compounded further. Inconsistent bank APIs generate technical complexity and uneven user journeys, while financial institutions often resist delegating SCA due to liability concerns.
It is here that Request to Pay (RTP) can change the game.
What is Request to Pay?
RTP is a messaging framework that allows a payee, such as a utility provider, to send a digital payment request directly to a payer’s bank or app, including all relevant details such as the amount and reference, and then receive acceptance or refusal from the customer before payment is initiated.
It is not itself a payment instrument but a way to request and trigger a payment, which can subsequently be completed through a credit transfer or instant payment once the payer accepts the request.
In Europe, this approach is being formalised under the SEPA Request‑to‑Pay (SRTP) scheme developed by the European Payments Council, with rulebooks and technical standards covering a wide range of in-person and online use cases.
What are the benefits?
RTP instils mechanisms that can reduce friction while still maintaining security and customer control.
By allowing customers to set up auto-approval or auto-acceptance rules that are based on the payee, maximum amount, or payment frequency, RTP can enable payments to be executed smoothly and efficiently.
These rules are managed within the bank’s own app or portal, meaning that the financial institution is able to still maintain ownership of the customer experience while validating payment requests in real time.
Flexible identifiers = frictionless payments?
RTP brings several benefits to customers. It is flexible enough to complement or replace existing payment instruments. For example, it can be used to recover funds after a failed direct debit, allowing banks to leverage RTP investments across multiple use cases.
The deployment of RTP supports flexible identifiers, such as phone numbers, email addresses, or even license plates, instead of traditional account numbers.
This opens the door to simpler, more straightforward payment experiences across both online and offline scenarios.
For example, if I use an online store and have a relationship with them, I could easily set up an auto-approval rule for them that allows them to send request to pay messages after my confirmation on their website for a purchase.
As the auto-approval rule is in place, the payment request will be received by my bank and result immediately in an instant payment that is being made and confirmed by then. Instead of needing to go through various screens, I can thus remain on the merchant website and confirm my account details there.
Similarly, something us commuters into Brussels can relate to is parking tickets. These payments could be linked to a license plate, automatically triggering a payment as the customer exits, eliminating the need for cards or apps entirely.
Another advantage of RTP is standardisation.
Unlike fragmented open banking APIs, RTP schemes are governed centrally, making implementation more predictable and reducing the technical burden on TPPs and banks.
Why open banking still plays a role
RTP should not be viewed as a replacement for open banking payment initiation. There are cases where it can be more beneficial, but it does not eradicate the efficiency and customer experience gains that can be achieved with proper investments into open banking.
In many markets, financial institutions still lack widespread or mature RTP use cases.
It is not mandatory, and its adoption can be slow or uneven, making other alternatives like open banking crucial.
In this context, payment initiation services (PIS) and account information services (AIS) provide practical ways to initiate and manage payments even when RTP isn’t available.
A PIS can securely trigger a payment from a customer’s bank account with explicit consent via standardised APIs, bypassing card networks, bringing down costs, and improving the payment experience for merchants and consumers alike.
Airline-focused solutions like IATA Pay illustrate this model, offering direct account-to-account settlement at the same time as lower fees and faster reconciliation than cards, even without universal RTP availability.
PIS-enabled ‘pay-by-bank’ flows are able to support a wide range of use cases, including e-commerce checkout, recurring or variable subscription and utility billing, B2B invoice payments, and travel or ticketing purchases.
Flows like this can deliver faster settlement than manual transfers while providing strong security through regulated open banking frameworks.
Meanwhile, account information services (AIS) don’t move funds but do allow authorised third parties to access account data like balances, transaction history, and account status with user consent.
This can allow for eligibility checks, account validation, credit and affordability assessments, cashflow insights for businesses, and confirmation-of-funds services, improving risk management and customer experience across the payment journey.
Getting ahead
Now is the time for banks to double down on open banking and RTP solutions, appreciating these methods as more than just compliance obligations or nice-to-haves and deploying them as a serious component for digital transformation.
Together, they create a powerful combination. While open banking PIS and AIS deliver flexible, cost‑effective ways to initiate payments and build data‑driven services, RTP adds certainty, richer user experiences, and new automated journeys.
Investing in both allows banks to innovate today while laying the foundation for tomorrow, bridging the gaps where RTP adoption is still emerging and accelerating digital transformation across all payment channels.
If you’re ready to design a future‑proof payments strategy, then contact Paylume to speak to our experts.
