NPP's Lovney : “Our focus is to make real time payments more accessible to Australians”

• NPP Australia are developing standards for structured data in a number of high priority areas
• OSKO, the first developed service on top of the NPP, will include the ability to attach a document with a payment or have a url link to externally hosted documents included in the message
• NPP 2.0  will cover additional sample APIs

Australia’s real time payments platform NPP, which launched in February 2018 and has been developed and funded by thirteen of the largest financial institutions will add in 2019 further functionalities and develop standards for structured data.

NPP enables consumers, businesses and government agencies to make real-time, data-rich payments between accounts from participating financial institutions. .  

“Our focus in 2019 will be on extending the number of accounts able to access the NPP beyond the nearly 51 million accounts currently connected via one of 72 Australian financial institutions, so that more Australians can send and receive fast, data-rich payments,” said  Adrian Lovney, CEO, NPP Australia.

Cumulative volume of transaction between February and December 2018 expected to reach 74 million, according to Asian Banker Research  

Fig 2 Monthly Value and Volume of Transactions (non-cumulative)

Source:Asian Banker Research,  RBA

Most banks are offering these payments via Osko – the first developed service on top of the NPP platform. Developed by BPAY Group, Osko taps into the Platform’s real-time clearing and data capabilities to deliver instant account-to-account payments service.

 “Osko request and payment with a document future iterations of the Osko service, which are already under development, will include “request to pay” functionality and the ability to attach a document with a payment or have a url link to externally hosted documents included in the message,” he highlighted.

Most banks have set a limit as to how much can be transfer using a PayID. The payment limits range from$2,000 to $20,000 per day. First time payments to a new payee may be held for up to 24 hours as a security measure. According to NPP, the average transaction amount stood at A$930 for the period between February to December 2018.

“The overwhelming majority of payments are P2P, with a small proportion being payments between individuals and businesses (and vice-versa),” Lovney added.

The Reserve Bank of Australia  advised at Sibos 2018 that their government clients were beginning to use the NPP for emergency government payments to individuals experiencing hardship

In late 2018, NPP Australia released version 1.0 of the NPP API framework which defines the key technical approach and mandatory data attributes for NPP APIs, aligned to ISO 20022 standards. The API framework contains samples for three APIs, which illustrate how the framework can be used. Those are PayID Resolution Request, Payment Initiation Request and Payment Status Request.

“The framework will be extended over time and work on version 2.0, which will cover additional sample APIs related to notification, payment cancellation and return requests, is already underway.  NPP Australia has been working with SWIFT to develop a testing environment that will allow fintechs and other payments providers to start learning and testing the benefits and capabilities of the NPP via APIs. This API sandbox, hosted in the cloud and protected by state-of-the-art security, will help foster innovation and open up the NPP ecosystem to third parties, and was made available in early 2019.”

Lovney said in order to help foster the ecosystem and drive volume on the platform, NPP Australia are developing standards for structured data in a number of high priority areas such as superannuation, payroll and e-invoicing. This will enable third parties to leverage the platform’s capabilities using agreed standards and a consistent approach to the treatment of data.

This activity, combined with the API work, will help support the growth of B2B and commercial payment volumes on the platform. 

“NPP Australia, in collaboration with the industry, are also in the early stages of developing capabilities that will enable the platform to support recurring payments linked to a customer consent or mandate authorising those payments as an alternative to the current direct debit process,” Lovney mentioned.

This capability is also intended to be able to support a range of use cases including payment initiation and ecommerce which will help drive volume and create additional commercial opportunities for NPP Participants. It is also designed to align with on-going developments in Open Banking, according to NPP