What are Account-to-Account Payments?

Neonomics

July 17, 2024

January 7, 2026

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5 minutes

Payments have come a long way in just a few years. We’re seeing more advancements to offer consumers a more secure and efficient way to pay for bills and online purchases, compared to traditional ways to pay such as cards. One of these new payment methods is Account-to-Account (A2A) payments, also known as direct bank payments, or pay by bank. In this blog post, we'll walk you through what account-to-account payments are, how they differ from other payment methods, and what’s in it for you as a consumer.

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What are account-to-account payments (A2A payments)?

Account-to-Account (A2A) payments enable you to pay for goods and services directly from your bank during a payment process, cutting out any middlemen such as cards. This means less chance for potential fraud and faster payments for you.

Whether you're paying a bill or shopping online, A2A payments make it simple: your money goes right from your bank to another bank account. No credit or debit card networks in the mix, no unnecessary complications. It's all about direct connections, which means better security for your money. This cuts down on transaction time with greater security because your money isn't bouncing around through a bunch of third parties.
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What is the difference of using A2A payments compared to other payment methods?

Credit and Debit Cards

Credit and debit cards have long been the go-to for digital transactions, but they come with their own set of complications. With cards, you're often navigating through a maze of networks, potential debt accumulation, and processing fees. A2A payments, on the other hand, offer a refreshing simplicity. They operate on the principle of moving funds directly between bank accounts, utilizing your actual available balance. This means you're spending money you have, not money you borrow, which keeps you clear of accumulating debt.

A2A payments are also inherently more secure. They don’t require sharing your card details with merchants, reducing vulnerabilities to fraud and data breaches. Each transfer is securely managed within the trusted environment of your bank's own systems, which are equipped with stringent security protocols and real-time fraud monitoring to protect your funds. Therefore, A2A payments not only simplifies your financial transactions but also provides a secure bridge for your money, ensuring a safer and more transparent handling of your finances.

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Digital Wallets‍

Digital wallets offer a convenient way to pay, but they can hit a snag when it's time to confirm card details on the move – ever scrambled to recall your card's CVC number during a checkout process? A2A payments streamlines this process by linking directly to your bank accounts, eliminating the need to remember card information. This direct connection not only simplifies the payment process but also adds a layer of security. Since A2A payments bypass the card network, they reduce the risk of card details being intercepted or fraudulently used. The payment journey becomes smoother and safer, with each transaction conducted within the secure environment of your bank's systems, protected by their advanced encryption and fraud detection protocols. With A2A payments, you can benefit from a seamless payment experience that's both user-friendly and secure, giving you peace of mind whether you're paying for bills on the go or shopping online.
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What is the difference between an account-to-account payment and a bank transfer?

The two terms are often used interchangeably, but there are some slight differences. bank transfer is a broader term that means any kind of payment starts from a bank account, moving money directly from one bank account to another bank account. It doesn’t specify how the transaction occurs; it just indicates that the source of the funds is a bank account.

For example, imagine you are paying a bill online. If you pay it via a bank transfer, you have to go to your online bank, set it up and transfer may take several days depending on the agreements between your bank and the merchants bank.

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Where with an account-to-account payment you can make the payment right from the merchant's website, portal, app and even right from the invoice - without having to leave the payment interface. And all the remittance information like the invoice number, merchant account number, etc is embedded so you do not have to copy/paste or type that information in again. This makes it much faster and easier especially if you are making the payment from a mobile device. Plus, the payment is near instant and does not cost extra.

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If you use a debit card, or even some mobile apps and digital wallets, even though you’re still paying from your bank account, it’s not a direct transfer. The money goes through the card provider first, which adds time and fees, that sometimes the payer (the customer) and the payee (the merchant) have to pay. The transaction fees can be quite high - sommetimes around 1% for consumers depending on the amount and much higher for the merchant.

So basically, an account-to-account payments is a form of bank transfer that is faster, more efficient, and less costly than a standard bank transfer or a debit card payment.

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‍Why more and more merchants and consumers are choosing account-to-account payments

A2A payments were designed to make payments more efficient, less costly and safer. In fact, according to the European Banking Authority (EBA), fraud rates for A2A payments are 3x lower because they use secure customer authentication (BankID, MittID, or your bank's own version). This make A2A also a smart choice. It's your money, moving on your terms, with a level of security and speed that traditional payment methods struggle to match. Better for you, better for the merchant.

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A2A payments are rapidly gaining traction in the Nordics and throughout Europe, and we believe it will play a significant role in shaping the future of financial transactions, making payments easier and more convenient for all.

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If you are curious to learn more about how your business could benefit from account-to-account payments? Let’s talk!