Account-to-Account (A2A) Payments – What you need to know

11 / 09 / 2025

Payment methods are continuously evolving and adapting to merchants’ and consumers’ needs. As innovation spurs in the payment landscape along with the rise of instant payments, we must answer a seemingly easy question, from multiple perspectives: what are Account-to-Account payments (A2A) payments?

1 min.

Payments Open banking Recurring payments

Account-to-Account (A2A) payments represent a new approach to financial transactions where funds move directly between bank accounts without intermediaries like card networks. This payment method leverages open banking infrastructure to create seamless, secure, and cost-effective transfers that bypass traditional payment rails.

Account-to-Account (A2A) – the alternative for everyday transactions

One of the European Union’s objectives with the second directive on payment services is to open up the financial market to new players with innovative and competitive services. One of these services is Account-to-Account Payments (A2A), where money is directly transferred between banks without intermediaries. While account-based payments have been around for a while, such as scheduling regular bill payments (e.g., direct debit) or using domestic payment schemes like iDEAL in the Netherlands, PSD2 and instant payments have given A2A the opportunity to challenge card payments as a credible alternative for everyday transactions. It has the potential to become the mainstream payment method as it offers major advantages over traditional payment methods. Now, Payment Service Providers (PSPs) can add this payment method easily to their portfolio, enrich their offerings, and meet the growing demand for Open Banking-driven Account-to-Account (A2A) payments.

How Account-to-Account (A2A) payments work

The process is remarkably straightforward. When a customer selects the A2A payment option at checkout, they're seamlessly redirected to their banking app where they can approve the transaction using their existing bank authentication methods. This mobile-native solution leverages Strong Customer Authentication (SCA) protocols, requiring customers to verify their identity through multiple factors such as biometrics or one-time passwords. Once approved, the payment is initiated immediately from their account, typically resulting in faster settlement times than traditional payment methods.

Benefits for all parties

A2A payments deliver significant advantages across the payment ecosystem. For merchants, these transactions can be up to 80% cheaper than card payments due to the elimination of interchange fees, resulting in substantially lower processing costs. The direct bank connection also means improved cash flow through faster reconciliation and reduced fraud risk compared to traditional card payments.

For consumers, A2A payments offer a convenient checkout experience with no card details to enter, higher spending limits than typical card transactions, and the security of using their trusted banking app's authentication methods. The mobile-first approach aligns perfectly with the growing preference for digital banking solutions.

What’s in for Payment Service Providers (PSPs)?

PSPs play a crucial role in facilitating payment transactions, enabling businesses to accept various payment methods while reaching new markets and customers globally. The success and growth of PSPs depend on their ability to offer a comprehensive range of payment methods. If a payment method is unavailable through a PSP, merchants may face significant challenges in providing it to their customers. This underscores the PSP’s unique position within the payment ecosystem, making them a critical component in introducing new payment methods. By harnessing the power of Open Banking, PSPs can unlock many benefits. These include enhancing the customer experience, meeting market demand, and increasing payment transactions, especially for merchants that rely on transnational customers. PSPs can also explore new segments in emerging markets, such as government services, high-value payments, corporate payments (B2B payments) or cross-border payments. From a strategic perspective, PSPs must adapt their offerings to the evolving payments landscape, as growing competition will significantly impact their ability to thrive in this dynamic environment.

The future of payments

As Open Banking continues to evolve and rises in adoption, these direct bank transfers represent a significant shift in how money moves between accounts. The combination of speed, security, convenience, and cost efficiency makes A2A payments particularly attractive for both recurring transactions and high-value purchases where card limits might otherwise be restrictive. In 2025, analysts are foreseeing a 30% growth in Europe’s A2A payment volumes and at the same time only 5% of banks are ready to lead the instant payment acceleration.

Worldline can simplify things for you

Worldline supports PSPs and acquirers in enhancing their payment portfolio with these new Payment Initiation Services to offer A2A payments to their customers. Learn more about how Worldline can help your organization integrate A2A payments seamlessly: