You've probably seen “Pay by Bank” buttons popping up on websites and invoices. Maybe you've used one yourself. But what is it actually? And why should you, as a tradesperson, care?
Short answer: Open Banking lets your customers pay you directly from their bank account with one tap. No card details. No cheques. No “I'll do a bank transfer when I get to my laptop.” Money lands in your account in seconds, and it costs you a fraction of what card payments charge.
Here's the longer explanation, in plain English.
What Is Open Banking?
Open Banking is a UK regulation that's been live since 2018. It requires banks to let authorised third parties connect to their systems — with the customer's permission — to initiate payments or read account data.
In practice, it means a company like TrueLayer (which mNudge uses) can create a payment link that connects directly to your customer's bank. When they click it, they see their own bank's login screen, approve the payment, and the money transfers immediately.
No card numbers. No Stripe or PayPal in the middle. No 2-3 day wait for funds to clear. It's a direct bank-to-bank transfer, but initiated from a link instead of your customer having to manually type in your sort code and account number.
How Does a Pay-by-Bank Payment Work?
From your customer's perspective, it's about five taps:
- They receive your invoice with a payment link (on WhatsApp, email, or text).
- They tap the linkand choose their bank from a list (Barclays, Lloyds, HSBC, Monzo, Starling — all the major UK banks are supported).
- They log in to their bank using their normal banking app or online banking credentials.
- They confirm the payment.The amount and recipient are pre-filled — they just hit “Approve.”
- Done.Money leaves their account and arrives in yours via Faster Payments — typically within seconds.
That's it. No typing your bank details. No remembering a reference number. No “I'll do it when I get home.” It's as easy as tapping a link on their phone.
Tired of doing this manually? mNudge handles it on WhatsApp.
Why It's Better Than Card Payments
If you've ever looked at taking card payments on a card reader or through an online payment gateway, you'll know the fees add up fast. Here's a comparison:
| Payment Method | Typical Fee | On a £1,000 Invoice |
|---|---|---|
| Credit card (Stripe/SumUp) | 1.5-2.9% + 20p | £15-£29 |
| Debit card | 1-1.5% + 20p | £10-£15 |
| PayPal | 2.9% + 30p | £29 |
| Open Banking (Pay by Bank) | 0.3-0.5% | £3-£5 |
| Bank transfer (manual) | Free | Free (but slow and fiddly) |
On a £1,000 boiler installation, the difference between card payments and Open Banking is £10-25. Do a few jobs a week and that's £500-1,000 a year you're handing to payment processors for no good reason.
Why It's Better Than Manual Bank Transfers
“But bank transfers are free,” you might think. “I just put my sort code on the invoice and they transfer.”
True. But manual bank transfers have two big problems:
- Friction kills conversion.Your customer has to open their banking app, find “pay someone new,” type your name, sort code, account number, amount, and reference. One typo and the money goes to the wrong place. Most people put it off.
- “I'll do it later” means never. If they can't pay in the moment they read your invoice, they'll put it aside. Then forget. Then you're chasing.
Open Banking gives you the speed of Faster Payments with the convenience of a payment link. One tap, done. No typing, no errors, no “I'll do it later.”
Is Open Banking Safe?
Yes. It's regulated by the Financial Conduct Authority (FCA). The customer authenticates directly with their own bank — nobody else ever sees their login details. The payment provider (like TrueLayer) never handles the money; it just initiates the instruction. The money moves directly from your customer's bank to yours.
It's actually more secure than card payments, where you're sharing a 16-digit card number with every merchant. With Open Banking, nothing sensitive is shared — just an authorised payment instruction.
Which Banks Support It?
All the major UK banks: Barclays, HSBC, Lloyds, NatWest, Santander, Nationwide, Monzo, Starling, Revolut, and more. Over 99% of UK current account holders can use Open Banking payments.
Your customers don't need to set anything up. If they have a UK bank account and a phone, they can pay you this way.
How mNudge Uses Open Banking
mNudge is built on TrueLayer, one of the UK's leading Open Banking providers. Here's how it works for you:
- You send mNudge a WhatsApp message describing the job and the amount.
- mNudge creates a professional invoice with a one-tap payment link and sends it to your client on WhatsApp.
- Your client taps the link, picks their bank, and approves the payment in their banking app.
- The money lands in your bank account via Faster Payments — typically within seconds.
- You get a WhatsApp notification confirming payment.
No card reader. No monthly fees. No payment gateway to set up. No merchant account. Just a WhatsApp message and a payment link.
And if they don't pay? mNudge chases automatically. The payment link stays live, so whenever they do get round to it, they can still pay in one tap.