The Payments Paddock - 10th June 2026: Card Scheme Rivals, Gov.uk Picks Adyen & Agentic AI

The UK Payments Initiative takes aim at Visa and Mastercard's dominance, Gov.uk drops Stripe for Adyen, and ING completes Europe's first end-to-end agentic payment transaction.

Key takeaways

• The UK Payments Initiative brings major UK lenders together to build a domestic A2A network that directly challenges Visa and Mastercard on cost and reach.
• Pay-by-bank adoption is growing fast — Amazon and Trading 212 are live examples — and recurring payment use cases could significantly cut costs for subscription businesses.
• Section 75 credit card protection does not extend to A2A payments; APP fraud reimbursement rules offer partial cover, but the gap matters for high-value purchases.
• Gov.uk has replaced Stripe with Adyen on a £25m annual contract, driven by open-banking capability requirements — a clear signal of growing institutional pay-by-bank adoption.
• ING's live agentic payment trial marks a practical milestone; the strongest use cases involve multi-merchant, multi-step transactions rather than simple single-merchant checkouts.
• Finance teams should model the net saving of shifting high-volume flows to A2A rails, accounting for dispute resolution costs that card chargeback frameworks currently absorb.

The UK Payments Initiative Takes On Visa and Mastercard

The UK Payments Initiative is a consortium of the country's largest lenders — including Barclays, NatWest, and Lloyds — pooling resources to fund a new account-to-account (A2A) payment network. The explicit goal is to challenge the stranglehold that Visa and Mastercard hold over the UK acquiring ecosystem.

The practical effect is twofold: lower processing costs for merchants and a domestic alternative to two US-headquartered card schemes. With geopolitical uncertainty prompting businesses across Europe to reassess reliance on American infrastructure, the timing is deliberate. Germany's Girocard offers the closest precedent for a domestic scheme achieving genuine ubiquity, but a UK equivalent has long been absent.

Amazon is already pushing pay-by-bank as the primary checkout method on its platform, and Trading 212 is cited as an early adopter of recurring A2A payments. The cost case is straightforward: eliminating card scheme interchange and acquiring margins on high-volume, high-value flows can save merchants hundreds of basis points. For a business turning over £10m or more, that is a material number.

Why the Banks Want a Seat at the Table

The consortium banks are not acting out of altruism. Under the current card model, even the banks issuing the cards — and those doing the acquiring — surrender a slice of every transaction to Visa or Mastercard. By co-funding and co-shaping the new network, they aim to own more of the value chain rather than remain a conduit for someone else's rails.

Bank accounts are near-universal in the UK. A pay-by-bank solution built on open banking rails sidesteps card-scheme tribalism entirely — there is no Visa versus Mastercard dynamic when the underlying instrument is a current account. That ubiquity is the network's single strongest structural advantage.

The Consumer Protection Question

One unresolved tension is consumer protection. Credit card users in the UK benefit from Section 75 of the Consumer Credit Act, which provides protection on purchases over £100 even if only £1 of the total was paid by credit card. Chargebacks under this framework do inflate processing costs across the board — but they also give consumers meaningful recourse against product defects, non-delivery, and fraud.

The Authorised Push Payment (APP) fraud reimbursement rules, now mandatory for UK banks, go some way to filling that gap for A2A payments. Provided a consumer applied reasonable due diligence and did not ignore bank warnings, they should be eligible for reimbursement. Whether that is equivalent to Section 75 protection — particularly for high-value discretionary purchases — will be a key question as adoption grows.

For merchants, the calculus cuts both ways. A business currently paying £1m per year in card processing fees that reduces that to £250,000 should expect to ring-fence a portion of the saving for dispute resolution and potential chargebacks — not just fraud, but product defects and delivery issues too.

Gov.uk Drops Stripe and Awards Adyen a £25m Contract

The Government Digital Service (GDS) has awarded Adyen — headquartered in the Netherlands — a contract worth just over £25m per year to replace Stripe as the payment service provider for non-Crown card payments and pay-by-bank services across Gov.uk.

The decision followed a competitive tender process and, according to GDS commentary, was shaped in part by Gov.uk's ambition to expand open-banking-style pay-by-bank options. Stripe offers A2A payment collection, but the GDS appears to have concluded that Adyen's capabilities in that area are better suited to its requirements.

Stripe is widely regarded as the developer's payment processor of choice — its genesis was built on simplicity and API elegance. Adyen, by contrast, has always positioned itself at the enterprise and institutional end of the market. For a government body with sharp cost-efficiency mandates and a growing infrastructure modernisation agenda, Adyen's proposition clearly won out.

The practical transition will not be seamless. Government payment migrations rarely are. Users should expect a period of re-authentication and re-entered card details. The longer-term prize — a more modern, mobile-friendly checkout experience across Gov.uk services — is worth pursuing, but anyone who has tried to pay a parking permit or penalty charge notice on a local authority website will recognise the gap between ambition and current reality.

ING Completes Europe's First Live Agentic Payment Transaction

ING, in partnership with Mastercard and Worldline, has completed what it claims is Europe's first end-to-end agentic payment transaction. In a demonstration, an ING customer used an AI assistant to search for concert tickets on the Royal Concertgebouw Orchestra website, select seats, and complete payment — all without manually navigating the merchant's checkout.

The FCA has recently published a framework addressing how agentic payment controllers can operate within the existing regulatory perimeter, so the timing of ING's live test is pointed. It signals that at least some institutions are moving faster than the regulatory conversation.

Useful Innovation or a Solution Without a Problem?

The honest question is whether agentic payments solve a real friction for most consumers. For a straightforward flight or event booking, an experienced user can complete a search in seconds. The agent does not obviously improve that experience for the majority of journeys.

The more compelling use case is complexity: assembling a multi-merchant package — flights, accommodation, car hire, restaurant bookings — where an agent could gather, compare, and book compatible options across several providers simultaneously, personalised to known preferences. That is a materially different task from clicking a date range on a flight search.

There is also a legitimate concern about where responsibility sits when an AI agent initiates a payment that turns out to be erroneous or fraudulent. If the consumer did not directly authorise each step, the APP fraud reimbursement framework may need further interpretation to accommodate agentic transactions. The intersection of agentic AI and consumer protection rules is an open question that regulators and platforms will need to resolve together.

Next steps

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