- A new payments platform allowing instant payment transfers between a network of 60 Australian financial institutions launched today.
- It’s easy to set up and gets rid of waiting times for bank transfers which can be up to three days.
Australia’s New Payments Platform (NPP) went live today, which allows instant inter-bank transfers using a simple ID system, with no annoying details like account numbers or BSBs required.
The payment ID, called your PayID, can be a mobile number or an email address. (I’ve just set mine up on my banking app and it took less than a minute. My bank set the default PayID to my mobile number.)
The platform should do away with one-day and three-day waits for bank transfers to complete between accounts.
Here’s how to get set up:
The first step is to create your PayID. Your bank, building society or credit union will let you know when you can do this and you’ll be able to do it within your usual mobile or internet banking.
Once you have created your PayID, the next time you want someone to pay money into your account, you simply ask them to pay it to your PayID. And if you need to pay someone else, simply ask them for their PayID.
The option to pay to a PayID will appear within your normal mobile or online banking. Every bank does this slightly differently. In some, the ability to pay a PayID will automatically appear as an option. In others, you may be required to choose an Osko payment first. Over time, we expect other payments products and services will include the option to pay a PayID.
We’re also advised: “When you enter a PayID, the name of the person who owns that PayID will be automatically shown. All you have to do is simply confirm it’s the right person as part of authorising the transaction. Once approved, your bank will securely communicate with theirs, sending the money into their account.”
The four major banks and Citi are among around 60 financial institutions on the platform.
Businesses can add a PayID to invoices and use a simple piece of software to enable real-time transfer of funds.
Banks will be contacting people to let them know the service is available and how to use it.
Treasurer Scott Morrison welcomed the launch of the new platform today. “Gone will be the days of frustrating three-day waits for transfers between accounts of different banks. Customers will be able to securely pay businesses, split restaurant bills with their friends, and pay a tradesperson instantly.
“Customers will also be able to include more information with their payments, such as additional text, invoices and receipts. This simplified approach will help businesses to make payments quickly and efficiently and let them get back to running their business.
“The NPP has been collaboratively designed and built by 13 key Australian financial institutions, including the Reserve Bank of Australia and the major banks, with the support of the Turnbull Government. Other financial institutions will be able to connect to the NPP directly or via an existing participant that offers connection services to smaller financial institutions,” Morrison said.