Amazon’s UK Move Puts Pay by Bank Into Sharper Focus

Pay by bank’s practical test has been whether it can scale beyond utilities, gaming and bill pay into everyday commerce.

With Amazon’s Tuesday (Feb. 10) introduction of its Pay by Bank service to customers in the United Kingdom, pay by bank’s reach has gotten a boost, placing one of the world’s largest commerce players squarely behind an account-to-account payment option that bypasses cards altogether.

The method allows consumers to pay directly from their bank accounts using existing online banking credentials. Instead of entering card numbers, shoppers select their bank, authenticate within their banking app and return to checkout with the payment confirmed.

The appeal rests on familiarity rather than novelty. The process mirrors digital banking behaviors many consumers already use, while offering merchants faster settlement and fewer intermediaries.

Amazon’s U.K. launch formalizes that logic. Amazon’s Tuesday announcement and a perusal of the page where customers can add the payment option reveal that Pay by Bank enables customers to complete purchases without storing card credentials, while refunds are issued within minutes once returns are confirmed.

The new rollout supports more than 99% of U.K. banks and relies on customers’ existing bank-level security, including biometric or PIN-based authorization within mobile banking apps, Retail Systems reported Tuesday.

Mechanics, Prime and the Checkout Experience

At checkout, customers can add Pay by Bank as a payment option, select their bank and authorize each transaction through their bank’s app. The authorization step occurs outside Amazon’s environment, with only limited account data exchanged, a structure designed to reduce exposure while keeping the flow predictable for consumers.

Amazon indicated that Pay by Bank will extend beyond one-time retail purchases, with support for Prime membership payments expected to follow.

That expansion matters. Subscription payments introduce repetition and habit, two factors that historically determine whether new payment methods gain traction. By embedding Pay by Bank into Prime, Amazon would place account-to-account payments alongside cards in one of the most frequently billed consumer relationships in the U.K.

All Pay by Bank purchases are covered by Amazon’s A-to-Z Guarantee, and U.K. Payment Services Regulations provide additional consumer protections. That layer of recourse addresses a longstanding concern about direct bank payments, namely, what happens when something goes wrong.

Adoption Tailwinds Are Building

Amazon’s timing coincides with broader momentum behind pay by bank. PYMNTS Intelligence’s January report “Pay by Bank Deep Dive: Digital Bank Users Are Ready to Switch,” a collaboration with Trustly, found that interest in direct-from-bank payments is no longer confined to early adopters. Digital bank users, in particular, are well-positioned to lead adoption due to their reliance on mobile banking and digital wallets.

The data showed that digital bank customers are 40% more likely than average to shift over one-third of transactions to pay by bank when incentives such as discounts or buyer protection are offered. Across transaction types, switching potential can reach up to 35% for account-to-account payments when those conditions are met.

PYMNTS Intelligence found that most consumers still view pay by bank as a potential substitute for debit, rather than for credit cards that offer rewards, float and dispute protections. That positioning aligns with Amazon’s framing of the product as an alternative way to pay, rather than a wholesale shift away from existing rails.

According to the report, digital bank users skew young, are more mobile-centric and rely on digital wallets. Nearly half of them prefer wallets for everyday purchases, making them comfortable with login-based, tokenized payment flows that map closely to pay-by-bank authorization models.

At the same time, challenges remain. Security perceptions continue to shape adoption, even when objective protections are in place. Roughly one-quarter of consumers said nothing would persuade them to use pay by bank, underscoring that education and trust remain gating factors. Incentives matter, but so does clarity around refunds, protections and how disputes are resolved.

The UK Is Fertile Ground

The U.K. offers a uniquely supportive environment for pay by bank. Open banking APIs are well established, consumer familiarity with bank-initiated payments is high, and regulatory frameworks explicitly support account-to-account commerce. The National Payments Vision promotes competition and efficiency in retail payments, reinforcing infrastructure that favors direct bank connectivity.

Against that backdrop, Amazon’s move carries weight beyond its own checkout. It signals that pay by bank has matured enough to be deployed at scale by a global platform. For the broader payments ecosystem, the message is that direct-from-bank payments are no longer peripheral.

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