New opportunities on Australia’s New Payments Platform are constantly emerging, an ongoing stream of new ideas which solve problems for the industry and its customers – as well as the peace of mind which comes with modern security measures, for both businesses and their customers.
Ahead of the Sibos 2020 financial services conference, we sat down with Leigh Mahoney, Head of Wholesale Digital, Carolyn Young, Head of Domestic Payments & Receivables, and Jackie Kallman, Head of Payments Industry at ANZ, to pick apart the outlook for the NPP. Below is an edited section of that conversation. You can read the first part HERE.
They started by addressing the security benefits provided by running payments on modern tech services like the NPP.
LM: I think it’s worth making a point about data and the NPP, as it relates to financial crime; screening, AML, CTF compliance and the like. At ANZ, we think this is a critical part of the NPP experience as we want what is best for our customers.
But you could, I suppose, make an argument that others banks are just not going to invest in the NPP because their customers are happy where they are. But I think there is a huge and underrated step up in payment safety, security and compliance piece that can be secured by businesses through use of the NPP.
The NPP can help ensure payments are legitimate, not fraudulent and - if fraud occurs - can pick it up straight away. I think this is where the NPP offers another leg up from a regulatory and compliance standpoint that really can't be ignored.
CY: I agree. With the NPP, if we have infrastructure that can provide context to payments, what they are being used for, and an easier way to access that information, we're going to be in a far better place to provide a system that is credible, maintains integrity, and offers insight into whether those payments are appropriate.
I think that’s a really important part of what the sector needs for our entire payment system.
JK: What's really interesting is we don't have to have a trade-off. I think in the past if something needed to go in a sanctions queue, there was a significant slowdown which was basically out of the hands of both banks and customers; speed and certainty in payments ran a risk of non-compliance.
With the NPP, you’ll get, in 99 percent of cases, both the really great experience but also the compliance and safety.
Broadly, the potential of the NPP starts to open the door for some creative solutions where, we may be able to just look at a customer problem and say, ‘what is the best technology or payment system or infrastructure that can solve this?'
And that convergence is not necessarily one of rails or the infrastructure itself, but more around the solutions that best meet the needs of the customer.
While you may have more overlap between services, you also have more room for choice, with less technical demand required.
LM: NPP started as P2P payment mechanism before moving into the institutional landscape. But traditional methods remain quite popular in both of those markets, handling the vast majority of payment volume.
What do we think are the things we need to change as an industry to help businesses move from these more traditional mechanisms to using NPP as the primary solution? If you look at it as a scale, even securing 50 per cent of volume on the NPP would be massive.