We are the sole Open Banking providers for HMRC, supplying our direct bank to bank payments and data services. Our partnership with HMRC is the world's first embedding of Open Banking within a Government.
How HMRC made history by Choosing Open Banking
In March 2021, for the first time ever, a government integrated Open Banking into their payment processes. HMRC in the UK now gives people the option to ‘pay by bank account’. Behind the payments is Ecospend.
HMRC felt the need to make taxes a little less, well, taxing. Now, they are at the forefront of innovation as they work with Ecospend to bring Open Banking to online payments for self assessment, PAYE and soon VAT and Corporation tax. IThe contract to integrate Open Banking with HMRC, which is worth up to £3million, was won by Ecospend after a rigorous procurement process. The technology from Ecospend enables account-to-account payment software, making it easier and simpler for UK citizens to make payments to HMRC.
So why now? Well, Open Banking has opened up a world of possibilities for businesses. Imagine that HMRC accepts more than 12 million self-assessment forms from citizens and before now, each one of those self-assessors had to log in to their banking software in order to make payments to HMRC. Before Ecospend added Open Banking to the HMRC website, each of those people also had to remember their unique tax reference number.
Now that HMRC is committed to bringing their digitisation agenda to life however, old methods of paying will likely become a thing of the past. All data is pre-populated and authenticated via biometric ID through Open Banking, making it much safer to use. By using validated information, Open Banking enables payments directly from the bank account to HMRC with much less risk of error or fraud.
As well as being quicker, Open Banking also cuts costs. Card payments are typically expensive, charging between 2% and 4% of every transaction. For 12 million payments, that’s a steep cost to pay. Open Banking’s direct account-to-account payments bypass these fees, offering the market a much more cost effective solution.
Ecospend improves customer conversion rates by providing a quicker and simpler customer journey. Card payments have a high abandonment rate and customers want to have quick, easy-to-use systems to make payments. The customer journey becomes seamless, faster and easier for mobile and tablet payments.
Together, Ecospend and HMRC are bringing taxes up-to-date with digital best practice. Open Banking is future-proofing the government system so that citizens can engage with HMRC in a way that suits their needs, to build trust and ensure that paying has never been easier.