What is a Payment Initiation Service Provider (PISP)?
Payment Initiation Service Providers are the providers of Payment Initiation Services. Authorised PISPs can connect to a customer’s bank account and initiate payments directly from that bank account on their behalf, rather than using a credit or debit card. Compared to traditional payment methods, PISPs promise a faster, cheaper and more secure method of payment.
Payments via PISP also reduce the risk of fraud, since transfers must be authenticated by the payer using Strong Customer Authentication and payers never pass their credentials to the merchant or payment gateway (they only enter them directly with their bank).
Examples of services offered by PISPs are:
- Instant checkout, where customers allow a company that they shop online with regularly to connect to their bank, take payment instantly and bypass any need to e.g. re-enter card details for every transaction.
- Mobile authentication of transaction payments via e.g. biometric confirmation
- Variable Recurring Payments, in which money in your various accounts are automatically shifted around (a process known as sweeping) to ensure your funds are optimised (for example, if your current account funds are low and you have a rent payment due, the VRP service will automatically shift money from your savings to cover the shortfall and prevent an overdraft or unpaid fee).
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Friendly Score UK Ltd.
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Company number 09168668, ICO ZA111687
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