In a step toward enhancing public sector payments, the UK government has reportedly opened bidding for a £49 million contract to embed open banking technology into its Gov.UK Pay platform.
Announced on February 19, 2025, by the Government Digital Service (GDS), this procurement initiative aims to enhance the digital payment experience for citizens interacting with over 1,000 public sector services.
The move underscores the UK’s role in fintech innovation and its commitment to streamlining financial transactions across government bodies, from local councils to national agencies.
Gov.UK Pay, launched in 2016, has reportedly processed around 100 million transactions worth £6.4 billion, serving entities like the NHS, police forces, and further education colleges.
At present, the platform relies on traditional payment service providers (PSPs) such as Worldpay and Stripe to handle card payments.
The contract, valued at £49,212,000 (excluding VAT), seeks a provider to integrate “pay by bank” open banking functionality alongside credit and debit card processing.
This would reportedly enable users to pay directly through their banking apps, offering a more frictionless alternative that leverages real-time payment rails—a feature popular in private sector fintech solutions.
The tender reflects over 18 months of planning, supported by GDS’s exploration of open banking in August 2023, when deputy director Amanda Dahl emphasized the potential for citizens to pay via their banking apps.
A subsequent request-for-information (RFI) in September of 2024 refined these objectives, resulting in this formal procurement.
The winning bidder will need to ensure 24/7 availability for over 750 public sector services, with a 12-month onboarding period targeting full service commencement in 2026.
This transition aims to lower administrative burdens, save costs, and maintain the platform’s intuitive user experience.
This initiative aligns with UK public sector trends, where open banking has gained adoption—HM Revenue & Customs (HMRC) has reportedly processed £13.5 billion in tax payments via the technology since 2021.
The GDS contract builds on this development, aiming to make Gov.UK Pay a cornerstone of citizen-centric digital services.
Bidders face an upcoming deadline, with initial qualifications due by March 19, 2025, and final proposals to be submitted by May 2, 2025.
As the UK continues to support open banking on an international level, this £49 million investment signals a move toward a more connected, accessible public finance ecosystem.