By: Money Navigator Research Team
Last Reviewed: 29/01/2026
FACT CHECKED
Quick Summary
Tide’s “Pay by Bank” on Payment Links is a bank transfer flow initiated from the payer’s banking app via Open Banking, so it can appear and settle differently from card-based link payments.
In Tide’s own description, it’s usually processed instantly and shows in the Tide timeline within minutes, but it only appears when Tide’s conditions are met (including amount limits and UK-only use).
This article is educational and not financial advice.
What “Pay by Bank” means on a Tide Payment Link
Tide describes “Pay by Bank” as a Payment Link payment method where the customer can pay directly from their banking app, rather than using a debit/credit card.
The customer is taken to their UK bank to authorise the payment, and Tide describes these payments as usually processed instantly through Open Banking into the Tide business account timeline. See Tide’s explanation in its Pay by Bank Payment Links article.
Practically, that changes what “settlement” means:
Card settlement is typically a payout process (processor > merchant) with card-scheme rails and payout cycles.
Pay by Bank settlement is a bank transfer credit into the receiving account, initiated through an Open Banking payment journey.
This matters because “paid” (payer authorised) and “settled” (funds credited and visible to the recipient) can be close together – but they are not the same concept across payment methods.
When the “Pay by Bank” option appears
In Tide’s documentation, “Pay by Bank” visibility is not guaranteed on every Payment Link. It appears when Tide’s conditions are satisfied, including:
1) Amount limits can hide the option
Tide states that Pay by Bank can be offered only when the invoice total is between £5 and £25,000; below £5 or above £25,000 the option won’t be visible. That limit logic is set out in Tide’s Pay by Bank Payment Links article.
2) UK-only payer context
Tide says you can’t receive international payments with Pay by Bank “for now”, and the flow is described specifically for UK customers. That constraint is also stated in Tide’s Pay by Bank Payment Links article.
3) Supported banks influence whether a payer can complete the journey
Tide lists many major UK banks as supporting Pay by Bank (examples include Barclays, Lloyds Bank, HSBC, NatWest, Santander, Nationwide, Monzo, Starling, and others).
If a payer’s bank is not supported (or their bank’s Open Banking journey cannot be completed for that payer), the “Pay by Bank” option may not be usable in practice even if it’s displayed.
4) Separate terms acceptance is part of the flow
Tide states customers are asked to agree to separate terms and conditions before being taken to their UK bank to authorise. If a payer does not accept or does not complete authorisation, the payment won’t settle.
The payer is redirected into their bank’s authorisation journey to approve the payment. The FCA explains that a payment initiation service provider (PISP) lets people pay companies directly from their bank account rather than using a debit or credit card, and that explicit consent is required for these services. See the FCA’s overview in Account information and payment initiation services.
Step 2: The underlying transfer is processed as a UK bank payment
Once authorised, the transfer is sent through the UK banking payment infrastructure. For many UK online and mobile transfers, Faster Payments is the common “near real-time” rail.
Pay.UK notes that funds are usually available almost immediately, though they can sometimes take up to two hours, and some payments take longer. See How Faster Payments work.
Step 3: “Available to you” vs “interbank settlement” are different layers
Even when recipients see funds quickly, the banking system’s interbank settlement can run on set cycles. The Bank of England explains that Faster Payments provides near real-time payments 24/7 and that net settlement takes place three times each business day in RTGS. See Payment and settlement.
In plain terms: a payer can authorise in seconds, the recipient can see funds in minutes, while interbank net settlement mechanics operate on their own schedule.
Fees and what “settlement” means for the net amount received
Tide states that when you receive payments through Pay by Bank, Tide collects a fee of up to 1.50% of the total transaction, capped at £25, and that Tide does not charge the customer for using Pay by Bank (though the customer’s own bank may apply fees under its terms). That fee description appears in Tide’s Pay by Bank fees article.
So when interpreting settlement:
Gross amount = what the payer intended to pay.
Fee = Tide’s Pay by Bank fee (up to 1.50%, capped at £25).
Net credited effect = what you treat as received after fees, as shown in the transaction details.
How it appears on your statement and why labels matter
Tide states that if you have sent a payment link, transactions relating to it appear in the account statement from “Tide Payout”. Tide also notes a different label for payments you make using an invoice payment link. See How payment link transactions appear in the statement.
This matters operationally because a “Tide Payout” label can group multiple settlement types (for example, card payouts and Pay by Bank credits can both be “payment link related”), so reconciliation often depends on checking the transaction’s details (amount, fee line, timestamps, payer details where available).
If you want a deeper site-specific walkthrough of how Tide payment links show to the payer (without rehashing it here), see our guide: Tide Payment Links explained: how they work and what the payer sees
Summary Table
| Scenario | Outcome | Practical impact |
|---|---|---|
| Invoice total is £4.99 | “Pay by Bank” not visible | Customer can only use other available methods (often card) |
| Invoice total is £5–£25,000 | “Pay by Bank” can be visible | Customer may choose Pay by Bank or card (where offered) |
| Invoice total is £25,000.01+ | “Pay by Bank” not visible | Larger invoices may need another collection method |
| Customer completes bank authorisation | Payment can settle quickly | Funds may appear in timeline within minutes, subject to bank processing |
| Customer abandons authorisation | No payment | Link remains unpaid; cash flow timing shifts |
| Reconciliation uses statement only | Labels may be broad | Transaction detail review can be needed to confirm method and fees |
Scenario Table
| Scenario-level | Process-level | Outcome-level |
|---|---|---|
| “Pay by Bank” displayed on link | Payer is redirected to their bank via Open Banking | Payment proceeds only if payer authorises successfully |
| Payer authorises successfully | Bank processes the transfer (often near real-time) | Recipient sees credit; fee is reflected in details |
| Bank processing is delayed | Payment still in flight | “Paid” and “settled/visible” timing can diverge |
| Statement reconciliation | Entries may show as “Tide Payout” | Transaction detail inspection may be needed for method/fee clarity |
| Refund needed | Pay by Bank refund is manual bank transfer | Refund handling differs from card refund mechanics |
Tide Business Bank Account
Tide’s Payment Links (including “Pay by Bank”) sit within a wider business account setup, where settlement visibility and statements depend on how the account and payment tools are configured.
For a neutral overview of Tide’s business account positioning and how it compares in the UK market context, see our Tide hub page: Tide business bank account review.
(For common blockers and eligibility points that affect whether features activate, this related guide may help frame the “why is it missing?” side: Tide Payment Links eligibility: common requirements and common blockers.)
Frequently Asked Questions
“Pay by Bank” is still a bank transfer in outcome (money moves account-to-account), but it is initiated through an Open Banking payment journey rather than by manually typing a sort code and account number. Tide describes the payer being taken into their banking app to authorise the payment as part of the flow.
Operationally, that means the payer experience resembles a guided checkout, but the settlement result resembles a bank credit rather than a card settlement payout. That difference is why “settlement timing” language can be confusing when comparing Pay by Bank to card-based Payment Link payments.
Tide states Pay by Bank is only available when the invoice total is between £5 and £25,000; outside that range the option won’t be visible. So two customers receiving similar links can see different options if the amounts differ.
Beyond amount limits, Pay by Bank relies on the payer completing a supported Open Banking authorisation journey. If a payer’s bank, account type, or authentication journey cannot complete successfully, Pay by Bank may be unusable even when other methods still work.
Tide states the Pay by Bank option is available only when the invoice total is between £5 and £25,000. If the invoice total is below £5 or above £25,000, the option won’t be visible.
In practical terms, that creates a “collection design” constraint: very small invoices may push payers toward card methods, while larger invoices may need alternative collection routes. Businesses that issue variable-value invoices can see Pay by Bank availability change from invoice to invoice purely because of the total.
Tide describes Pay by Bank transactions as usually processed instantly and appearing on the Tide app timeline within a few minutes. That reflects the intent of near real-time account-to-account payment journeys.
However, UK bank payment processing can still vary. Pay.UK notes funds are usually available almost immediately but can sometimes take up to two hours, and some payments take longer. So “minutes” is a common experience, but delays can occur depending on the sending/receiving institutions and processing context.
In Open Banking payment initiation, the payer must authorise the payment in their banking app. Tide describes the Payment Link status showing as “Successful” when an invoice has been settled using Pay by Bank.
“Settled” can be used in two senses:
- Customer-visible availability (you see the money)
- Interbank settlement mechanics
The Bank of England explains that Faster Payments provides near real-time payments, while net settlement occurs on business-day cycles in RTGS – so the system can show funds quickly even though interbank settlement runs on separate rails and schedules.
Tide states it collects a fee of up to 1.50% of the transaction, capped at £25, for Pay by Bank, and that Tide does not charge customers for using Pay by Bank (though their bank may apply its own fees). Tide also states you can see fees applied in the transaction details.
For reconciliation, this means the gross invoice value and the fee line both matter. Two payments of the same value can produce different net outcomes if fee caps apply at higher amounts, and accounting processes often need to record the fee as a cost separate from revenue.
Tide states that if you have sent a payment link, transactions relating to it appear in the account statement from “Tide Payout”. That statement label is designed to group payment link-related entries.
Because the label is not necessarily a full description of method by itself, the transaction details are typically where method and fee context are confirmed.
This is particularly relevant when comparing Pay by Bank credits (bank transfer outcome) with card payouts (processor settlement outcome) under the same broader “payment link” umbrella.
Tide states that Pay by Bank transactions need to be refunded manually. That means sending a bank transfer back to the customer using their sort code and account number, which Tide says is visible on your statement from the date you received the payment.
The operational edge case is timing and data: the information needed for the refund is linked to the settled transaction record, so refund handling can depend on when the credit appears and what payer account details are displayed. This is different from card refunds, which are typically executed through the card payment workflow rather than a new outbound bank transfer.
If the payer does not accept the relevant terms or does not complete the bank authorisation step, the payment won’t be initiated successfully, and the link remains unpaid in practical terms. The key point is that “opening the link” is not the same as “sending money”.
In cash flow terms, this creates a common reconciliation scenario: a customer may believe they “tried to pay”, while the merchant sees no settled funds. In these cases, the practical distinction is whether the bank authorisation completed and whether the payment reached a status that results in a credit.
Card payments typically sit within card scheme rules (including chargeback processes) because the payment instrument is the card scheme network. Pay by Bank is an account-to-account transfer initiated via Open Banking, so the underlying dispute mechanics are not the same as card chargebacks.
That does not mean disputes can’t exist; it means the route and terminology differ. In operational terms, businesses often treat Pay by Bank as a bank-credit receipt (with its own fraud/authorisation considerations) and treat card payments as scheme-based receipts that may carry scheme dispute processes.
“Pay by Bank” is best understood as a permissioned bank transfer journey rather than a card checkout alternative that happens to be cheaper or faster. The decisive constraint is not the UI – it’s the combination of (a) Open Banking authorisation, (b) the payer’s bank journey completing, and (c) UK payment infrastructure posting the credit.
That’s why the most reliable way to interpret “when it appears” is to treat it as a ruleset (amount band + UK-only + supported journeys), and the most reliable way to interpret “how it settles” is to separate customer-visible availability (often minutes) from interbank settlement mechanics (scheduled cycles). This distinction explains most real-world confusion around “paid vs settled” across Pay by Bank and card methods.
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