A2A payments explained: What they are, how they work, and use cases

Key takeaways

• A2A (account-to-account) payments transfer funds directly between bank accounts without card networks, typically offering lower fees and faster settlement than traditional card payments.

• Real-time payment rails and open banking APIs enable instant A2A transfers with enhanced transparency, though adoption varies by country and relies on banking infrastructure.

• Airwallex supports A2A payments through local payment rails and direct bank connections, helping businesses reduce transaction costs and improve cash flow across multiple currencies.

Paying 2.5% on every transaction adds up quickly. For a business processing £500,000 annually, that's £12,500 in card fees—money that could be reinvested in growth. Account-to-account (A2A) payments offer a way out.

By transferring funds directly between bank accounts, A2A payments bypass card networks entirely, slashing transaction costs to fixed fees as low as £0.50 per payment. They settle faster than cards, reduce fraud exposure, and eliminate chargeback risk. For B2B payments, high-value transactions, and recurring billing, they're rapidly becoming the smarter choice.

This guide explains what A2A payments are, how they work, when they make sense for your business, and how Airwallex's global payment infrastructure can help you implement them across multiple currencies and markets.

What are A2A payments?

A2A payments, short for account-to-account payments, transfer funds directly between bank accounts without involving card networks like Visa or Mastercard. Instead of routing through intermediaries that take percentage-based fees, A2A payments use bank infrastructure to move money from payer to payee.

These payments utilise real-time payment networks, open banking APIs, traditional bank transfer systems, or direct debit arrangements. 

A2A payments are increasingly popular for both business-to-business transactions and consumer payments, particularly in markets with mature real-time payment infrastructure.

How do A2A payments work?

The process begins when the payer authorises a transfer from their bank account to the payee's account, either manually or through automated systems. The payer's bank then verifies the transaction using security measures like two-factor authentication, biometric identification, or established payment credentials.

Once authenticated, the payment instruction travels through payment rails—whether real-time networks, ACH systems, or direct bank connections—to the receiving bank. Finally, funds move from the payer's account to the payee's account, which can happen instantly, within hours, or in 1-3 business days depending on the payment rail used.

Push vs pull payments

Push payments allow the payer to initiate the transfer and "push" funds to the recipient. These are common for one-time payments and payouts.

Pull payments enable the payee to request funds from the payer's account after authorisation. These are used for direct debits, subscriptions, and recurring billing.

A2A payment rails and infrastructure

Different payment rails offer varying speeds, costs, and geographic coverage:

Each country typically has domestic payment systems that facilitate A2A transfers, such as Faster Payments in the UK, FedNow in the US, and NPP in Australia.

Payment initiation services (PIS) use regulated APIs to initiate bank transfers on behalf of customers, enabled by frameworks like PSD2 in Europe. Some payment platforms maintain direct integrations with banks to facilitate A2A payments without going through traditional intermediaries.

Benefits of A2A payments

Lower transaction costs

Card payments typically cost businesses 1.5-3.5% per transaction, whilst A2A payments often cost fixed amounts (£0.20-£1 per transaction) or small percentages. This significantly reduces costs on high-value transactions.

For example, a £10,000 payment processed by card at 2.5% would incur £250 in fees, whilst the same A2A payment might cost just £0.50-£5.

Faster settlement

Real-time A2A payments settle within seconds or minutes, compared to 2-3 days for card payments. This improves cash flow and reduces working capital requirements, allowing businesses to access funds more quickly and manage their treasury more effectively.

Reduced fraud exposure

A2A payments authenticate directly with the payer's bank using strong customer authentication. Unlike card payments, they don't expose sensitive card details that can be stolen or reused, reducing the risk of fraud.

Once an A2A payment settles, it cannot be disputed through chargeback mechanisms (though fraud disputes may still be possible), providing greater payment certainty for merchants.

Enhanced transparency

A2A payments include detailed remittance information and clear transaction trails, simplifying reconciliation and accounting processes. This transparency helps finance teams match payments to invoices more efficiently and maintain accurate records.

Limitations and challenges of A2A payments in 2026

Different banks offer varying interfaces and authentication methods, creating fragmented user experiences. Unlike standardised card payments, A2A payment experiences can feel inconsistent to users, which may impact conversion rates for consumer-facing businesses.

Whilst regions like Europe have SEPA, true cross-border A2A payments face challenges with different payment rails per country, varying settlement speeds, and complex correspondent banking relationships.

Many consumers remain more comfortable with cards than bank transfers, particularly for online purchases. Implementing A2A payments requires different infrastructure than card processing, creating integration effort for merchants.

A2A payments also rely heavily on banking infrastructure, including banking hours and cut-off times, account verification processes, and the accuracy of beneficiary account details. Failed payments due to incorrect account details are harder to recover than card payment failures, requiring additional verification and re-submission.

Common A2A payment use cases

A2A payments vs card payments

When to choose A2A over cards

A2A payments become particularly attractive for high transaction values where card fees become prohibitive for large invoices or bulk payments. Businesses with tight margins that can't absorb percentage-based fees also benefit significantly from fixed-fee A2A payments.

The method works especially well in B2B relationships where payment reliability is established and in payout scenarios when paying suppliers, sellers, or contractors rather than collecting payments from customers.

Understanding how A2A payments fit into your broader payment strategy helps optimise costs across your entire payment stack.

A2A payments vs other bank transfer methods

A2A vs wire transfers

Wire transfers typically incur higher fees of £15-£50 or more per transfer and require manual processing, making them suitable primarily for large, one-off international transfers.

A2A payments, by contrast, offer lower fees and automated processing, making them better suited for regular, domestic transfers, though they're increasingly becoming available for international transfers as well.

A2A vs ACH/local clearing

A2A is often an umbrella term that includes ACH and local clearing systems. The distinction is that "A2A payments" typically emphasises modern, API-driven initiation, real-time or near-real-time settlement, and integration with open banking frameworks.

Traditional ACH or clearing system transfers may involve slower, batch-processing approaches that take longer to settle.

How Airwallex supports A2A payments

Airwallex enables businesses to make and receive A2A payments across multiple currencies and payment rails, without maintaining separate banking relationships in each market. The platform provides local payment rail access in 30+ currencies with both real-time and standard settlement options, alongside automated payment processing and reconciliation capabilities.

By maintaining direct integrations with local banking systems, Airwallex allows businesses to send local A2A payments as if they had a domestic bank account, receive faster settlement than traditional correspondent banking, and reduce fees associated with intermediary banks.

These A2A payment capabilities integrate seamlessly with your broader payment operations, allowing you to combine A2A with card payments and other methods whilst maintaining unified reporting across payment types through a single platform for global payment management.

This integrated approach is particularly valuable for businesses using multiple payment methods, as detailed in our guides to international payment gateways and B2B payment gateways.

The future of A2A payments

Countries worldwide are implementing or upgrading real-time payment systems, including the UK's Faster Payments and New Payments Architecture, the EU's Instant SEPA and instant payment mandates, the US's FedNow and RTP expansion, and various national instant payment schemes across Asia-Pacific. This trend accelerates A2A adoption by making transfers instant and reliable.

Open banking frameworks continue expanding beyond Europe, enabling easier payment initiation through APIs, better authentication and user experiences, and bringing new payment service providers into the market.

As transaction costs pressure margins, more businesses are prioritising A2A for high-value transactions, implementing A2A as their primary B2B payment method, and encouraging customers to pay via bank transfer instead of cards.

International payment standards like ISO 20022 are improving cross-border A2A payments, though true global standardisation remains years away. For businesses operating internationally, understanding how A2A payments integrate with your complete payments infrastructure helps inform strategic decisions around eCommerce payment gateways and other payment methods.

Conclusion

A2A payments offer compelling advantages for businesses seeking to reduce transaction costs, accelerate cash flow, and minimise fraud exposure. Whilst they work best for B2B transactions, recurring payments, and high-value purchases, their role in modern payment stacks continues expanding as real-time infrastructure improves globally.

The key is understanding when A2A payments make sense for your business model and implementing them alongside other payment methods where appropriate. As open banking matures and real-time rails proliferate, A2A payments will likely become standard for an increasing range of transaction types.

Ready to integrate A2A payments into your business? Open an Airwallex account to access local payment rails, competitive FX rates, and multi-currency A2A payment capabilities designed for growing businesses.

FAQs

What does A2A stand for in payments?

A2A stands for "account-to-account," referring to payments that transfer funds directly between bank accounts without using card networks or other intermediaries. The term emphasises the direct nature of these bank-to-bank transfers.

Are A2A payments the same as bank transfers?

A2A payments are a type of bank transfer, but the term typically refers to modern, API-driven transfers using real-time payment rails or open banking. Traditional bank transfers may involve slower batch processing through legacy systems.

Are A2A payments cheaper than card payments?

Yes, typically. Card payments cost 1.5-3.5% per transaction, whilst A2A payments often cost fixed amounts (£0.20-£5) or much smaller percentages. The savings become substantial for high-value transactions.

Are A2A payments suitable for B2B payments?

A2A payments are particularly well-suited for B2B transactions due to lower costs on high-value payments, faster settlement, and no chargeback risk. Many businesses are prioritising A2A for supplier payments and B2B invoicing.

Can businesses use A2A payments for payouts and payroll?

Yes. A2A payments work well for payouts to suppliers, marketplace sellers, contractors, and employees. The low per-transaction costs and bulk processing capabilities make them efficient for regular payroll and payout operations.