Introduction

Open Payments is a standard for interactions between wallets (well actually any account servicer like a bank, a PSP, mobile money provider etc. but we just say wallets to keep things simple). Open Payments is used between the wallets to setup and authorize payments for a variety of common use cases.

Open Payments builds on web technologies to define ways for a wallet to:

  • discover the API endpoints at another wallet, using an identifier for an account or account owner at that wallet
  • use the APIs to setup a payment between the two wallets
  • exchange information with the other wallet that is required to complete the payment (business terms, regulatory info etc.)
  • get authorization from the account owners (as required) to complete the payment
  • setup and authorize future payments

The Interledger Protocol Stack

Open Payments is designed as an application level protocol built on top of the Interledger protocol. It could be used over other payment clearing systems but the assumption is that accounts discovered via Open payments support Interledger for making the payment itself.

Roles

Often referred to as the four-corner model, the primary roles in most retail payment scenarios are the Customer (Sender), Merchant (Receiver), Acquirer (services the account of the merchant) and the Issuer (services the account of the customer). The four-corner model is very card-centric but still provides a good framework from which to define the roles in the various Open Payments scenarios.

Borrowing standard terminology from the ISO20022 data-model we refer to the issuer and acquirer as account servicers and the merchant and customer as account owners.

Examples of an account servicer is a bank, a digital wallet or a mobile money provider. The account servicer will run Open Payments Clients for initiating an Open Payments interaction and Open Payments Servers to accept incoming requests from clients.

For brevity we simply call account servicers "wallets", but always keeping in mind that this extends beyond the traditional definition of a "digital wallet" as a consumer product/service.