Open Banking
A way to pay directly from your bank account through secure banking APIs, instead of using a card.
Definition
Open Banking lets a licensed third-party provider initiate a payment straight from a player's bank account to the operator, moving money account-to-account (A2A) rather than through the Visa or Mastercard card networks. The player authenticates inside their own banking app or online banking, so the operator never handles card details and the transfer is confirmed in near real time. In regulated markets it rests on a legal and technical framework — in the EU/UK, the Payment Services Directive (PSD2) and its Payment Initiation Service (PIS) rules — that obliges banks to expose standardised APIs to authorised providers. For iGaming, it is used both for deposits and, increasingly, for faster withdrawals.
Worked example
A player deposits GBP 50 at a UK-licensed casino. Instead of entering card numbers, they choose "Pay by Bank," are redirected to their banking app, approve the GBP 50 with Face ID, and the funds arrive as an instant account-to-account transfer. The operator pays the Open Banking provider a flat or low percentage fee (often a few pence to around 20-40p per transaction, versus roughly 1.5-2.5% for card acquiring), and because the bank has already applied Strong Customer Authentication, there is no card chargeback risk. On withdrawal, the operator can push winnings back to the same verified account, which also supports source-of-funds and responsible-gambling checks.
Why it matters
Payments are where deposits succeed or fail and where margin quietly leaks. Open Banking can lower transaction costs, cut fraud and chargebacks, and remove the card-network friction that causes some deposits to be declined, so it directly affects conversion and unit economics. It also strengthens compliance: because the money is tied to a verified, named bank account, it supports KYC, anti-money-laundering, and affordability/source-of-funds checks that regulators increasingly expect. Professionals should understand it as both a cost lever and a player-protection and regulatory tool, not merely a checkout button.
Related
Note: The core mechanism (A2A payment via bank APIs) is a stable definition. The regulatory framework, provider availability, fees, and settlement/withdrawal speed vary sharply by jurisdiction: PSD2/PIS governs the EU and (post-Brexit) the UK's Open Banking regime, while other regions (e.g. US "open banking" rules, Brazil's Pix, India's UPI) differ in standards and maturity. Specific fees, chargeback treatment, and whether Open Banking is permitted for gambling should be verified per operator, provider, and licence.