What Is PayID and How Does It Work?
PayID is your ticket to quick and convenient money transferrals, and is something easy to remember, such as your phone number, email address or an ABN that you can exchange with others when making or receiving payments.
Using a unique number registered with your bank, your PayID is securely linked to your nominated account and essentially replaces your BSB and account number when making or receiving payments. Creating your PayID can be done as soon as your bank or financial institution has informed you of its incorporation. With the convenience of mobile and internet set-up, this can be completed without having to make a visit to your local branch. As an additional convenience, payments linked to your PayID will move between your accounts, should you choose to switch bank accounts.
Once your account is set-up, the option to pay under your PayID will appear within your normal internet or mobile banking system. While some banks or financial institutions enable PayID to appear automatically, others may require you to first choose an Osko payment.
When making a payment to another PayID account, all that’s needed to do is simply verify you’re sending money to the right person and once approved, the respective banks will communicate and money will be transferred. As part of an Okso payment, this is usually completed within a minute.
Wait, What is Osko?
Osko is the first consumer service to be built on the New Payments Platform to use the PayID functionality. Developed by BPAY, Osko is a payment system that leverages the capabilities of the New Payments Platform.
Working in conjunction with PayID, Osko offers the same instant payment system on a 24/7 basis, conducted through a customer’s existing banking channel.
Benefits of the New Payments Platform for Consumers
With internet and mobile banking far surpassing that of the traditional methods of banking and money transfers, the need for seamless, straightforward payments without exchanging BSB and account numbers is a much welcomed concept for today’s technology reliant consumers (also known as everybody). As a user of the New Payments Platform, consumers can also have a better handle on their budget and finances, eliminating the need to revisit their bank statements to account for past transactions that may still be awaiting transferral.
Gone are the days of waiting the whole weekend for payments to be transferred (and for both consumers and business owners alike, money being stuck in financial limbo). Instant transferrals via the New Payments Method means money will automatically appear in the recipients account, making for quicker payments and avoiding the uncomfortable situation of having to chase up money for split bills.
When making one-off payments to a private seller, consumers also enjoy the benefits of immediate payment, or organise the sale of larger items such as a vehicle with additions such as registration transfer, finance and any checks undertaken on the spot.
NPP Applications and Opportunities for Your Business
As a business owner, looking at the New Payments Platform as a robust platform rather than simply a new way to pay for consumers will enable you to operate your business more effectively, reduce costs and improve your overall customer service management.
Under the New Payments Platform, additional information regarding a payment will also be able to be shared. Currently, invoices being paid by a business will only have reference to an invoice number – under the NPP, businesses paying part of an invoice will be able to enter each item number being paid, making payment reconciliations easier for the recipient. Additionally, the flexibility of having a payment ID created from a phone number or email address can mean businesses will be able to more easily switch between banks in order to take advantage of better deals without being tied down to a provider that may not be meeting their business needs.
In terms of security, additional remittance information provided under the NPP can also minimise the risk of money ending up in the wrong account, benefiting consumers and businesses alike.
Small business owners using the NPP will also have the ability to send full invoices and receive full remittance from customers upon payment, making for smoother transactions and a more streamlined approach to bookkeeping.
With immediate processing, medium to large businesses will improve cash flow management and have a more efficient reconciliation process, eliminating issues such as missed payroll cut-offs and having immediate rectification for payments that may need out of hours attention.
Additionally, government organisations under the New Payments Platform also can also capitalise on the advantage of instant transactions, with urgent financial Government support for emergency welfare and disaster assistance being made available immediately.
How Do I Start Using the New Payments Platform?
Whether you’re a business owner or simply want a quick and convenient new way to make payments, the New Payments Platform is ready and waiting for you. You can access the platform by enquiring with your current financial institution.
To find out what the new payments platform means for your business, check out our blog on this topic.