Instant cash transfers a reality under new bank payment system

Consumers will be able to access transferred cash instantly under the New Payments Platform (NPP) confirmed by 12 Australian financial institutions yesterday.

The NPP was confirmed after financial messaging company SWIFT was announced as the winner of the tender for the project, which will cost participating institutions over $1 billion.

The new technology will allow cash transfers between financial institutions to be accessed instantly. It will also provide additional data about payments, enabling customers to transfer funds to recipients identified by mobile phone numbers, not just BSB and account numbers.

It will connect payments made by customers who bank with the project’s 12 participating institutions: ANZ, Australian Settlements, Bendigo and Adelaide Bank, Citigroup, Commonwealth Bank, Cuscal, Indue, ING DIRECT, Macquarie Bank, National Australia Bank, Reserve Bank of Australia and Westpac.

Bank of America, HSBC, Bank of Queensland, Suncorp and PayPal were initially involved in the project but have since pulled out.

NPP Steering Committee Chair Paul Lahiff said, “We have reached a defining moment for the future of Australian payments. The industry’s vision in response to the Reserve Bank’s challenge for faster, richer, 24x7 payments is now well on the way to becoming a reality.”

The network will be built using the ISO 20022 standard, which will enable connections between the Australian network and international networks, although no such plans have been announced.

The NPP will go live in late 2017.