Here we look at two revolutions going on in payments. The first, QR codes, is well underway. The second, Variable Recurring Payments, is getting going. Both build on the modern payment infrastructure of open banking, real time payments and wallets.
Case study: QR codes and the Philippines 24 countries with almost five billion people (55% of the world’s population) have a national QR code payment standard, ensuring point-of-sale (POS) consistency, commonality and interoperability.
While a mix of digital wallets and real-time payments are defining consumer payments today, QR codes remove the need for hardware at POS and, online, the need for the manual entry of account details. The resulting low friction payment experience for consumers, and low-cost digital payment acceptance for retailers, has had a huge impact. Sole traders and small businesses have particularly benefited.
Using the Philippines as a case study, Bangko Sentral ng Pilipinas (BSP) created the QR Ph standard in 2019 to unify a highly fragmented QR landscape in the country. Initially this standard was just for person-to-person (P2P) payments, but in 2021 it was extended to person-to-merchants (P2M). Full adoption was mandated from 30 June 2023.
Merchants no longer have to display multiple QR codes because of the ‘one QR code for all banks and merchants’ approach. Today 60 institutions participate in QR Ph P2P and 48 in QR Ph P2M.
The standards ensures full interoperability for account-to-account (A2A) payments, wallet-to-wallet, account-to-wallet etc., even if between different institutions. All are connected to the Philippine’s InstaPay real-time clearing system.
The volume and value of P2P transactions since mid-2023 has grown on average 35.9% and 33.5% each quarter from the fourth quarter of 2024 to 2025, from 20 million to almost 70 million payments. P2M payments grew from 50 million in Q4 2024 to 1.1 billion in Q4 2025, 15x the volume of P2P.
The government is strongly encouraging the use of QR Ph as part of its financial inclusion strategy. With only 35% of medium and small size merchants using it, the opportunity for growth is significant.
In 2025 the Philippines real-time payments volume (through InstaPay) was 4.7 billion transactions, same as the UK. The year before it was 1.4 billion payments, less than one third of the UK. This is even more remarkable when you consider that the Philippines population is 75% larger than the UK and that the UK is more or less fully banked whereas a large proportion of Filipinos are unbanked and e-money wallets such as GCash dominate 1.
Case study: VRP in the UK
Direct debits work. As a result they are used for 5 billion payments a year.
However, commercial Variable Recurring Payments (VRP) look set to shake things up, offering flexibility and consumer control.
In 2025 in the UK open banking reached 16 million active users and grew 53% year on year. VRPs are a key component of this growth, accounting for 16% of all open banking payments. VRP are built on open banking, allowing consumers to authorise securely trusted third parties to manage recurring payments.
Much of VRP adoption so far has been when consumers move funds between accounts in their own name, but the UK’s National Payments Vision wants to accelerate VRPs for agreed ‘phase 1’ use cases – utility payments, financial services transactions and payments to local and central government. This is part of reducing reliance on Visa and Mastercard.
In 2025 31 firms established the UK Payments Initiative (UKPI) to support the rollout of additional commercial applications. The first live payment is due before the end of March 2026, but has not yet been confirmed.
Use cases for commercial VRPs include tenants controlling when and how frequently they pay rent and utility bills, loan repayment tools to schedule payments when customers are best able to meet them, paying into pensions/mortgages/ investments, buying rail tickets, and merchants and consumers gaining clear visibility of incoming payments, reducing missed bills and unexpected charges. Eventually this could also include routine spending such as grocery shopping and online purchases.
For commercial VRPs to reach scale, broad adoption across the payments industry, merchants, and consumers is essential, with industry feedback suggesting at least 75% current account coverage is needed to build confidence and unlock their full benefits. Pricing of course, will need to work for all, both users and system/ payment providers.
The challenge of displacing direct debit and card-based recurring payments is huge. Perhaps VRP will coexist with them rather than redefining or disrupting them.
Direct debit is the dominant way the UK pays regular bills for a reason. It is a system built on bank-to-bank trust, clear authorisation, and consumer protections. The combination of scale and consumer confidence has made recurring payments feel routine rather than risky. The good news is that Pay by Bank, VRPs and bill-pay platforms are building on the trust and acceptance of recurring payments that debit cards built up.
Just as for Direct Debit, the underlying technology enables consent and dynamic authorisations, but adoption depends on crisp user experience, clear safeguards and operational processes for disputes and changes.
When direct debit was launched, the campaign was based on three principles:
The new technologies, Pay By Bank, commercial VRPs and bill-pay platforms will need to combine trust, operational clarity, and simple consumer messaging if they are to succeed.
1 - GCash is a leading digital wallet and finance super app in the Philippines, offering a wide range of services for everyday transactions and financial management.
