Other parts of this series:
In my last post, I talked about the important role Request to Pay (RtP) will play in the future of payments—it will , bring flexibility to payers, cost reduction and efficiency to billers, and a huge value opportunity to financial services providers that have an Open Banking infrastructure in place.
In this post, let’s take a look at some of the initial forays into RtP services from across the globe.
Request to Pay framework, UK
RtP framework was launched by Pay.UK in May 2020. The service offers a secure messaging service framework to help businesses and individuals manage and settle bills securely and flexibly.
In this framework the RtP process is initiated by a payee when they send a request for payment to the payer. The payer and payee information is maintained in a secure repository network through which the messages are routed. Payers are offered with 5 options to respond to payment request:
- Pay the full amount
- Pay in part
- Request an extension
- Decline payment
- Send a message in response to the bill
This Open API driven messaging service overlays on top of existing payments infrastructure (Faster Payments or Cards Network) and offers greater control, flexibility and communication in the payments process.
SEPA Request to Pay Scheme , Europe
Launched in November 2020, SEPA Request to Pay scheme introduces a four corner ecosystem that allows a payee to request the initiation of a payment from a payer through payee’s RtP service provider and a payer to express their payments preferences aligned to their needs via payer’s RtP service provider.
The scheme allows immediate and deferred timing aspects (“now” or “later”) to be assigned to both the RtP acceptance and RtP payment initiation as below:
- Accept now: the RtP must be accepted by payer immediately
- Accept later: the RtP can be accepted by payer at a later time
- Pay now: the RtP must be paid by the payer immediately, at the acceptance time
- Pay later: the payment is initiated at a later term than the acceptance time
Similar to UK’s RtP framework, SEPA request to pay scheme is a messaging functionality not a payment instrument. Both frameworks offer similar benefits around speed, control and flexibility in the bill payments process
A similar simpler bill payment solution is available in Australia via BPAY, which is built on the New Payments Platform as an overlay service.
BPAY allows businesses to send bills and statements online directly to their banking app in bulk and provides customers with an easy way to make payments directly from their banking application. The service offers a range of APIs to retrieve biller details, validate payments, or generate unique Customer Reference Numbers to simplify bill payments experience. Over 60,000 businesses in Australia offer BPAY to their customers to pay bills securely while making it easier for themselves to reconcile their accounts receivable.
Similar to other Request to Pay frameworks BPAY offers simple and secure payment and reconciliation process. However, the service is only accessible via a banking application.
NETS, the Denmark-based payments services provider, offers OmniBilling, an e-invoicing platform that enables banks, businesses and governments to establish an ecosystem for digital billing optimisation. The platform empowers users by providing a central overview and real-time insight.
NETS is well known for its previous bill-pay solutions in Norway and Denmark, eFaktura and Betalingsservice. More than 90 per cent of Danish and Norwegian households use Nets services to pay their bills.
These global examples portray the demand and benefits of a Request To Pay solution that will take away the frictions and pain points in the present bill payment experiences. The widespread usage of Request to Pay service across various geographies reiterate the potential of an Open API driven flexible payment ecosystem, fit for the needs of users in a post-pandemic world.
Organisations including banks, fintechs, and payment providers who want to play a leading role in tomorrow’s payment services ecosystem will need to be smart and start identifying their roles in the RtP ecosystem today.