Commercial VRPs are emerging as the strongest candidate to replace legacy card-based payment systems for UK recurring revenue businesses. New research from GoCardless, published in its Revolutionising Recurring Revenue report, surveyed 489 UK business leaders. Its Revolutionising Recurring Revenue report reveals deep frustration with existing payment rails among decision-makers responsible for recurring revenue. Nearly three-quarters (73%) reported ongoing pain points with card payments. Combined with fraud and administrative overhead, card-related costs drain an average of 3.5% of monthly revenue.
These findings arrive as the UK Payments Initiative (UKPI), a coalition of 31 financial institutions including GoCardless, Nationwide, and NatWest, begins operationalizing cVRPs. The FCA and PSR confirmed that the first live payments under the UKPI scheme launched in early 2026. Wave 1 targets regulated, lower-risk sectors: utilities, financial services, insurance, and government.
Commercial VRPs Address Card Payment Friction
GoCardless found that 42% of respondents spend more than three hours per week managing card-related issues. Failed payments, expired cards, and chargebacks create a recurring drag on cash flow. Staff productivity suffers alongside margins. Subscription and recurring billing businesses feel this friction most acutely because each failed collection triggers a cascade of retry attempts, customer notifications, and potential churn. Over a 12-month cycle, these micro-failures add up to significant revenue loss.
cVRPs solve these problems by using open banking infrastructure for account-to-account payments. Unlike card-on-file systems that store sensitive details prone to expiry and fraud, the new payment method allows customers to authorize recurring bank payments through a single consent. Amounts can vary, schedules can flex, and the process runs on bank rails rather than card networks. Because commercial VRPs pull directly from bank accounts, they eliminate card expiry as a failure point entirely. As a practical entry point, GoCardless positions its Recurring Pay by Bank product for businesses ready to adopt commercial VRPs today. The company processed the world’s first VRP transaction in 2019. It now handles over $130 billion in payments annually across 30 countries, serving more than 100,000 businesses through direct debit, real-time payments, and open banking.
Strong Demand Across Wave 1 Sectors
Expectations among decision-makers in the initial rollout sectors run high. According to the GoCardless report, 91% of Wave 1 leaders expect commercial VRPs to reduce operational costs. An additional 89% believe the technology would improve cash flow significantly.
Sentiment in financial services runs even stronger. Ninety-five percent of respondents in that sector say commercial VRPs would help save money. Ninety-two percent expect reduced late payment volumes. Additionally, 88% anticipate higher overall customer satisfaction. Half of all businesses surveyed (49%) intend to be early adopters once the technology becomes available through familiar payment channels.
This level of demand reflects a broader frustration with payment leakage and cash flow gaps that legacy card infrastructure creates for recurring revenue businesses. Forty-one percent of respondents cited access through their existing payment provider as the top factor that would encourage adoption. An equal share pointed to wider consumer bank coverage. Both responses suggest demand depends less on awareness and more on delivery infrastructure.
Consumer Readiness Aligns with Business Interest
Corporate appetite alone does not guarantee adoption. However, GoCardless research among 2,000 UK adults suggests consumer readiness is building. Thirty-eight percent are open to adopting commercial VRPs. That figure jumps to 60% among Gen Z respondents. Interest peaks around essential services, with 46% willing to use cVRPs for energy bills.
UK open banking now reaches over 15 million users, roughly one in three adults. VRPs already account for 16% of all open banking payments. Most current volume involves sweeping transactions between a customer’s own accounts. cVRPs extend that functionality to payments between a customer and a business. Once live, cVRPs open use cases for usage-based charges like energy bills and flexible payment plans. Younger demographics already comfortable with alternative payment models should find the transition seamless. Consumers cited increased financial control and greater security as top reasons for their interest, suggesting that trust in bank-led payment rails already exceeds trust in stored card credentials for many users.
Regulatory Framework Supports Phased Rollout
Regulators are overseeing a structured, phased approach to commercial VRPs. Wave 1 covers regulated, lower-risk sectors. Later phases will expand into e-commerce, retail, and digital subscriptions. UKPI has secured funding, agreed on a commercial model, and established pricing clarity with the CMA. Under the centralized access fee model, UKPI sets the price that banks charge payment initiators, creating a predictable cost structure for all participants. This regulatory coordination distinguishes commercial VRPs from earlier open banking initiatives that struggled without unified industry support.
By the end of 2026, the FCA plans to evaluate industry-led adoption. It will then embed lessons from Wave 1 into a long-term regulatory framework for open banking payments. Treasury legislation expected in 2026 will grant the FCA new powers to set open banking rules, giving the framework a statutory foundation. Early adopters therefore have a window to integrate the new rails before broader mandates take effect. The National Payments Vision explicitly calls for expanding cVRPs into broader commercial use, signaling sustained government backing for the initiative.
Early Adopters Gain a Clear Edge with Commercial VRPs
GoCardless Chief Product Officer Shaun Puckrin emphasized the competitive advantages available to first movers. Crowdfund Insider reported that the GoCardless report positions the technology as a way for UK businesses to cut revenue leakage and strengthen customer loyalty simultaneously.
Businesses want the technology integrated into familiar workflows, not bolted on as a separate system. Puckrin stated that reliance on high-friction legacy methods is ending. With 15 years of bank payment experience and early involvement in live VRP testing, the company brings deep infrastructure knowledge to its Recurring Pay by Bank product.
Across utilities, financial services, and telecoms, the data points in one direction. Legacy card infrastructure costs too much, fails too often, and creates too much friction. Commercial VRPs offer a bank-led alternative built on open banking rails, backed by regulatory coordination, and supported by growing consumer readiness. Every quarter that passes without migration means continued revenue leakage at the 3.5% rate the GoCardless data identifies. With Wave 1 live and consumer adoption climbing, the commercial VRPs opportunity is no longer theoretical. Businesses that act in 2026 will lock in lower collection costs, higher retention rates, and cleaner cash flow before the rest of the market catches up.