The UK government has launched a tender process to select a new payment service provider (PSP) for its GOV.UK Pay digital payments platform, with plans to integrate open banking payments into the system.
GOV.UK Pay, operated by the Government Digital Service (GDS), supports over 1,000 public sector services, including the NHS, police, and local authorities, in processing digital payments. Since its inception in 2016, the platform has handled 94 million transactions totaling over £6 billion.
On 19 February 2025, GDS issued a tender notice inviting PSPs to underpin the GOV.UK Pay platform, specifically for processing credit and debit card payments and pay by bank (open banking) transactions. This follows an earlier Request for Information (RFI) issued on 18 September 2024, aimed at assessing market capabilities in digital payment processing.
This initiative aligns with the UK government’s broader commitment to open banking, as outlined in its National Payments Vision, which emphasizes the development of seamless account-to-account payments. Regulatory bodies, including the Financial Conduct Authority (FCA) and the Payment Systems Regulator (PSR), have been urged to accelerate innovation in this space.
Interested PSPs must submit applications by 19 March 2025, with the selected provider awarded a £49.2 million contract (excluding VAT). The contract will run from July 2025 to July 2028, with two potential 12-month extensions. A 12-month onboarding period will precede full-service implementation, expected to commence in 2026.
This move marks a significant step towards modernizing the UK’s public sector payment infrastructure, enhancing efficiency, security, and accessibility for millions of users.
