Instead of waiting hours for a transfer or several days for a cheque to clear, Australians will be paid in a matter of seconds, 24 hours a day, seven days a week, 365 days a year.

The implications are significant for working capital, consumer peer-to-peer payments and future innovation in the payments sector.

Using the Australian New Payments Platform (NPP) selling will no longer be fraught with a merchant having to wait for a payment transfer to process over hours, or days, through the two banks as is the case now.  The business will be able to check their bank balance and verify the payment is there as the goods are handed over.  

The NPP will underpin all mobile transactions.

For the businesses that operate with large working-capital cycles, cash flow and funding exposures, NPP enables the rationalisation and calendaring of payments to suit the cash flow availability for paying the business’ debtors to a specific date in the invoicing time frame. The ability to attach documents and a text description to a payment will offer efficient reconciliation and daily payments tracking. Profiles can be built of customer buying behaviour and payment history.

The NPP system’s architecture, and payment processes are based on the worldwide industry standard messaging format, ISO 20022

• Delivering real-time payments;

• Making and receiving payments any time of the day, seven days a week;

• Transmitting remittance information with payments;

• Choices for addressing payments:

  • Government welfare, social services, disaster relief, emergency services payments;

  • Property purchase deposits and settlements;

  • Dividend and rebate payments;

  • Refunds;

  • Loans.

A mobile phone number, email address or Australian Business Number, are linked to a bank or a debit/credit card and/or bank branch and individual account number.

Australia's New Payments Platform Architecture

Author: Kevin Beck, Associate, nem Australasia

This article is based on research and opinion available in the public domain.