Overhaul of Australia’s direct debit scheme – channelnews
A new direct debit payment feature goes live today, giving customers more flexibility and control over recurring payments.
PayTo is part of the radical changes in the financial sector, known as the new payment platform. It’s a new rapid payment infrastructure built by the Australian financial services industry.
It’s a digital alternative to direct debit, offering “a new level of visibility and control”, according to New Payment Platform Australia.
It allows merchants and businesses to initiate real-time payments from their customers’ bank accounts. The client will receive notifications and can authorize them instantly.
Users can view and manage PayTo agreements in their internet or mobile banking app.
It also removes the need for a card, allowing customers to use their bank account directly for payments that previously required a card, without having to enter card details and expiration dates.
For merchants, this removes the need to go through Mastercard or Visa, which charge fees for these services.
NPP explains, “A business or merchant will establish a ‘PayTo Agreement’ with you. This is where you authorize how much and when you will pay for goods or services. It can be a one-time, one-time or recurring payment.
“The PayTo agreement will appear in your internet or mobile banking app for your authorization. Once you have authorized the agreement, the company can debit your account according to the terms you have agreed to.”
Although PayTo officially launched today, Commonwealth Bank is the only major company ready to implement the feature, with Westpac, ANZ and National Australia Bank all missing the June 30 deadline.
BankWest, Bendigo and Adelaide Bank, RACQ Bank, Great Southern Bank and People’s Choice Credit Union will soon be rolling out the service.
“For retail-focused businesses, large billers like utilities and government departments, PayTo will allow them to receive fast and secure payments from their customers’ bank accounts, as an alternative to cards or payment options. international players online,” says Katrina Stuart. , Managing Director of NPP Australia.