The New Payments Platform (NPP) is Australia’s innovative payments infrastructure, developed to make payment transactions quicker, easier and smarter for businesses and consumers alike, meaning payments can be made in line with the always-on nature of today’s digital lifestyle.
The NPP platform allows for real-time payment clearing and settlement between participating Australian banks and is designed to take the pain out of moving money in Australia.
The NPP is a platform that enables real-time clearing and settlement for simple or complex payment solutions, between people and businesses. Payments are simplified through the use of a PayID, and are made richer through the inclusion of additional information such as written text or links to other documents.
The introduction of the NPP means an increase in payment options - adding to the methods already in place, such as BPAY®, RTGS, credit/debit cards, cash, cheques and direct entry. While these existing methods will still remain, it’s anticipated that the NPP will eventually become the preferred payment option due to its enhanced features and overall benefit to businesses and consumers.
Over time, the platform is expected to continue to evolve to meet the ever-changing needs of the market.
The NPP has been collaboratively developed by New Payments Platform Australia Ltd (NPPA) in collaboration with 13 founding financial institutions as well as a number of others who are connected by way of these 13 institutions.
The 13 institutions are:
Above all else, the NPP is designed to deliver payment speed, with the promise that both parties in a transaction can access funds in less than one minute.
The fast payment happens as a result of three separate components working together:
A PayID is an easy-to-remember identifier such as an email address, that is set up to link to your bank account.
Note that you do not need a PayID in order to take advantage of fast payments over the NPP. A PayID can however come in handy as it makes your details as the fund recipient, easier for the customer to remember.
PayID doesn’t replace your standard BSB or account number - it’s a linked ID that you can provide to avoid the hassle of having to remember or to provide those numbers.
You can use an email address. The Assembly team can then set this up on your behalf as part of your integration process so that you can receive funds to the account connected to that PayID.
Osko is a technology that works with NPP and acts as an enabler to move money rapidly from one account to another. A new product created by BPAY, Osko streamlines the transfer of funds.
The NPP gives you the ability to upgrade your customers’ payment experiences as well as making back-end processing more efficient and cost effective for your business. Key benefits are outlined in the below table.
The NPP means fast, simple and secure payments between your business and the consumer. Before the NPP, if a consumer wanted to transfer money to a business it could take up to three business days. Now, they can make payments instantly, and best of all, they can do it without having to remember a BSB and account number or a BPAY code.
And because NPP payments are subject to the Reserve Bank’s current real-time fraud screening and detection capabilities, consumers and businesses can trust that their money is safe.
If your answer is yes for any of the below questions then the likelihood is that your business will benefit from using NPP.
Businesses can use Assembly to accept payments from consumers or other businesses through the NPP and benefit from:
Businesses receive many payments in a single day and needing a person or team to manage this inflow creates considerable burden. Through the Assembly API, payouts can be automated and triggered as and when they happen throughout the day. This means payments can be made without being added to overnight batches or managed by a person or team - they’re instant.
NPP transactions have been growing steadily since its launch, with over 2 million PayIDs created as at the end of September 2019, and over 35 million payments worth approximately $30 billion sent through the platform.
The business benefit of using the NPP, i.e. faster payments, outweighs all the other means of payment which are either slow or much more expensive. As a result, It’s thought that the NPP will continue to phase out direct-entry payments, particularly for transactions that are time sensitive.
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