For banks, fintechs and non-banking financial institutions (NBFIs) that have held back from UK Faster Payments, the equation is changing.  That doesn’t make participation a lightweight operational decision, but greater choice over how to participate, new technology approaches and the ability to manage more complexity outside the institution mean that old assumptions about cost and complexity deserve another look.

Faster Payments is hardly new. It is already a fundamental part of the UK's payments infrastructure. In 2025, the system processed 5.55 billion transactions worth £4.84 trillion, according to Pay.UK. What deserves closer attention is how the market around it has developed.

For financial institutions (FIs) that previously considered Faster Payments and saw major infrastructure investment, specialist expertise and an operating model better suited to a large clearing bank, the calculation is different today. Institutions now have more choice over how they participate and where the connectivity and settlement complexity sits. Pay.UK recognises different participation models depending on factors like an institution's proposition, payment volumes, preferred connection method and their appetite for the responsibilities of direct participation.

Direct access has widened too. Eligible non-banking payment service providers have been able, subject to safeguards, to hold settlement accounts at the Bank of England since 2017. The Bank says this can reduce reliance on commercial sponsors and support competition, innovation and resilience.

 

The Economics Have Changed

But the decision is no longer simply between building everything yourself or staying out. Different approaches to participation allow FIs to decide more deliberately what they want to own and where specialist providers can take on infrastructure complexity. That changes the cost equation, particularly for institutions that cannot spread infrastructure and operational costs across the transaction volumes of a large clearing bank.

Technology is changing the calculation too. At Bottomline, our work with newer integration approaches, including REST APIs and JSON, shows how established payment infrastructure can be made easier to work with, absorbing some of the underlying technical complexity. The value isn’t the API itself, but what it can simplify for the institution. That creates a different investment conversation.

The question is less about whether an institution can build everything required for Faster Payments and more about whether it should, and whether that’s the best use of its investment and expertise.

 

Banks Should Challenge Old Assumptions

For established banks, scale, control and existing infrastructure will still make ownership the right choice. But it shouldn't be treated as intrinsically valuable simply because it has historically been part of the model. The question is whether owning every layer still delivers enough control or value to justify the cost and specialist resources it requires. Customers don't choose a bank because it owns a particular payments gateway. They care whether money reaches the right destination quickly and securely, whether they can see what has happened and whether problems can be resolved.

 

Fintechs and NBFIs Should Avoid Inheriting Incumbent Complexity

For fintechs and NBFIs, the starting point is different. Their competitive advantage often sits in the proposition, customer experience and ability to move quickly. Recreating the technology model of a much larger incumbent simply to reach an established payment rail can undermine some of that advantage.

They still need the same confidence in areas such as resilience, fraud controls and payment processing, but that doesn't mean they need to replicate the infrastructure model of an established bank. If specialist infrastructure complexity can sit elsewhere, fintechs and NBFIs can keep more of their resources focused on their proposition and customer experience. The priority is to build around their own business model, not inherit the infrastructure choices of an established bank.

 

Lower Barriers Don't Mean Lower Standards

More flexible connectivity does not reduce the responsibilities that come with real-time payments. Fraud, liquidity, compliance, resilience and exception management must still work around the connection.

If anything, speed makes some of those capabilities more important. With less time to stop or recover a payment, checks and decisions need to happen earlier. Validation and fraud detection therefore need to sit much closer to the payment workflow, with intelligence applied earlier in the payment journey rather than relying primarily on what happens afterwards. The opportunity is to remove infrastructure complexity where it makes sense, while strengthening the capabilities that protect the payment and improve the customer outcome. That focus on what happens around the payment is important beyond fraud.

 

The Bigger Opportunity Begins After Connectivity

Connecting to Faster Payments is not, by itself, a payments strategy. The payment journey begins before a transaction reaches the rail and continues after the infrastructure has done its job. Validation, fraud and risk assessment, routing, processing, visibility and exception management all contribute to the outcome. Treat those functions as separate systems and easier connectivity solves only part of the problem.

Routing illustrates the point. Recipient reachability, timing, cost, liquidity and risk can all influence how a payment should move. Customers shouldn't need to understand the infrastructure underneath. What matters is getting money to the right destination at the required speed, with appropriate controls and visibility.

The same applies to fraud. If intelligence can identify elevated risk before a payment is released, its value is very different from identifying the same behaviour after the transaction has completed.

Visibility matters for the same reason. Knowing where a payment is, identifying an exception quickly and having enough information to resolve it are part of the payment experience. The more useful measure of modernisation is not simply whether an FI can connect to another rail, but what it can do better with that access. Can it identify risk earlier? Make better routing decisions? Give customers greater visibility? This is where connectivity starts creating commercial value.

 

Why Now?

What has changed is that some of the assumptions historically associated with Faster Payments participation deserve to be revisited. Institutions have choices over how they participate; different operating models can place infrastructure complexity in different places; and newer integration approaches can make established infrastructure easier to work with.

None of that makes Faster Payments frictionless. The operational demands of real-time payments remain, and direct participation won't be the right choice for every bank, fintech or NBFI. But the options available today are different enough that an institution which ruled out Faster Payments several years ago could now be basing that decision on assumptions that no longer hold.

For established banks, now is a useful moment to question whether every layer of payments infrastructure still needs to be owned, or whether investment could create more value elsewhere. For fintechs and NBFIs, it is worth reconsidering Faster Payments without assuming that access requires the infrastructure model of a large incumbent. The starting points are different, but both have reason to revisit earlier assumptions.

The strongest business case will not be built solely around reaching Faster Payments. It will depend on what that access makes possible across the payment workflow, from validation and fraud prevention to processing, visibility and exception management.

For institutions that have previously decided against participating, the most useful question may no longer be “Why should we connect?” but whether the reasons for not doing so still stand.