Account-to-account payments are on course to disrupt the duopoly that Visa and Mastercard have long maintained over UK retail transactions, according to a landmark study published by UK Finance. The report projects that A2A payments will process £95 billion annually by 2030, driven by merchant adoption of Pay by Bank solutions at both online and in-store checkout points. The New Payments Architecture being developed by Pay.UK is expected to provide the real-time clearing infrastructure that makes sub-second A2A transactions viable at physical terminals.

"The card networks have had three decades of unchallenged dominance at the point of sale," said Adrian Sheratt, head of payments policy at the British Retail Consortium. "Open Banking finally gives merchants a credible alternative with transparent, predictable pricing." Major retailers including Tesco, John Lewis, and ASOS have begun piloting Pay by Bank at checkout, with early results showing conversion rates comparable to card payments and significantly lower processing costs.

Visa and Mastercard have not remained passive. Both networks have acquired Open Banking companies and launched their own A2A products, effectively betting on both sides of the transition. However, industry sources suggest that interchange revenue — which accounts for the bulk of card network economics — faces structural decline as regulators in both the UK and EU push for greater payment method competition. Shares in both companies have underperformed the FTSE All-World index over the past six months as investors digest the implications of the shift.