What is a PISP? Payment initiation explained

A PISP, or payment initiation service provider, is a regulated firm that starts a payment from a customer's bank account on the customer's instruction. The customer picks their bank and approves the payment in their banking app. The money then moves straight from their account to the payee's. The PISP never holds the money and never sees the customer's banking password.

The EU's second Payment Services Directive (PSD2) made payment initiation a regulated service and required banks to give authorised providers access to customers' online payment accounts. The UK put those rules into law with the Payment Services Regulations 2017 and kept them after leaving the EU. In the UK the Financial Conduct Authority authorises PISPs; in each EU country, the national regulator does.

How a payment through a PISP works

For the customer it takes a few taps. Behind them, five steps happen in order:

1. The customer chooses to pay by bank. Your checkout shows a list of banks for the customer to pick from, usually supplied by the PISP.
2. The PISP asks the bank for the payment. It sends the amount, the payee's account and a reference to the bank's open banking interface. The bank sets up a payment that the customer still has to approve.
3. The customer approves it at their bank. They're sent to their banking app or website, where they sign in as usual and confirm. The bank runs this check, called strong customer authentication.
4. The bank sends the money. In the UK a single payment like this normally travels over Faster Payments. Euro-area payments go as SEPA credit transfers, or instant ones where both banks support them.
5. The PISP reports the status. It tells your system whether the bank accepted the payment. You can then confirm the order or offer another way to pay.

1. Your checkout Creates the payment
2. Instruction: payment request
3. PISP Regulated for initiation
4. Instruction: open banking API
5. Customer's bank Customer approves here
6. Money: Faster Payments
7. Your bank account Receives the payment

What a PISP does and doesn't do

A PISP is authorised to start payments. Its initiation permission doesn't let it hold funds. In a payment initiation flow the money leaves the payer's account and arrives in the payee's without passing through the PISP. That's the main difference from a card acquirer or a payment facilitator. Both of those collect the funds and pay them out to you later. Some providers also hold e-money or payment institution licences and sell accounts that do collect funds first. Check which of the two you're buying.

The customer signs in with their own bank. The bank then tells the PISP whether they authorised the payment. Neither the PISP nor your site ever handles their banking password or card number.

PISPs and AISPs

PSD2 also created a second regulated service, account information. An account information service provider (AISP) can read balances, transactions and account details with the customer's consent but can't move money. Many firms hold both permissions. That's why the same providers offer bank linking and payments. Unirail's provider directory shows which of them offer each service in each country.

Who the regulated party is

When a business accepts payments through a PISP, the PISP carries out the regulated initiation service. Whether your own business also needs authorisation depends on what else it does, for example whether it holds customer funds. That's a question for your compliance team. Some providers also let a platform that holds its own licence run payments under it.

Which providers offer payment initiation

The table lists the providers in Unirail's catalogue that offer single immediate payments. It shows where each one offers them and whether Unirail routes to it today. Check the countries you need, because coverage varies. Each row links to its source.

"Listed only" means the provider offers payment initiation there and Unirail doesn't have an adapter for it yet. The full list, country by country, is on the single payments capability page.

Using more than one PISP

One PISP is the simplest way to start. Platforms add a second for coverage, when one provider reaches banks or countries the other doesn't; for cost, since contracts priced per payment differ; and for resilience, because a bank's connection through one provider can fail while the other still works. Once there are two, every payment needs a choice of provider. Making that choice is called payment routing.

Unirail makes that choice for each payment. It returns the PISP to use, what the payment will cost under your contract, how long it should take, how likely it is to succeed and why. The PISP stays the regulated party. In Decide mode Unirail receives only masked metadata and your backend calls the PISP with your own credentials. The payment routing page explains how each decision is made.