Taking the stress out of new super obligations

By | NPP

Taking the stress out of new super obligations

By Robin Beauchamp, CEO, Integrated Payment Technologies (InPayTech)

Employers who don’t pay employees their full superannuation entitlements will face stiffer penalties under proposed federal laws, making it crucial for employers to get their payments systems right to ensure timely payments – and new payments technology can make this task much easier.

Businesses will be given a 12-month amnesty to pay workers any unpaid superannuation guarantee (SG) payments or face harsher penalties under a Bill the Federal Government has recently introduced into Parliament.

Under the proposed legislation, to use the amnesty, employers must pay all the SG that is owing to their employees, including interest. The amnesty will make it easier for employers to pay outstanding employee entitlements as the Federal Government will set aside penalties for late payment that are normally paid by employers.

Employers that do not take advantage of the one-off amnesty will face steeper penalties when they are subsequently caught – in general, a minimum 50 per cent on top of the superannuation they owe workers. Throughout the amnesty period, the ATO will continue its usual enforcement activity against employers for those historical obligations they don’t own up to voluntarily.

The Bill will also require superannuation funds to report employer contributions at least monthly to the ATO, allowing for the earlier identification of non-payment. Fraudulent businesses that deny workers their superannuation will find it harder to avoid getting caught.

The proposed new measures are welcome, and they are needed. The ATO has previously estimated that in 2014-15, around $2.85 billion in SG payments went unpaid. While that represented a 95 per cent compliance rate, any level of non-compliance is unacceptable as it is tantamount to wage theft, which is why the Government has given the ATO the resources it needs to enforce compliance.

Technology can help

New technology can help employers pay their workers their full superannuation entitlements on time.

InPayTech’s system, PayVu, significantly speeds up the payment of superannuation to the same day and reports these payments to the ATO via Single Touch Payroll (STP) as they are made.

For employers with 20 or more employees, STP reporting of SG payment information will be mandatory from 1 July 2018.  STP streamlines the way employers report tax and superannuation information to the ATO, which will be able to track which employers are paying the right amount of superannuation – and which ones are not.

Importantly, PayVu removes the payment delay incurred when an employer uses a clearing house to pay SG. When paying superannuation via a clearing house, an average of 4.2 days elapses between the money leaving the employer’s account and arriving at the superannuation fund’s account. PayVu payments are transferred the same day. The notion of ‘member direct’ payments is a crucial element to increasing the transparency and efficiency into the way salaries and superannuation are paid.

STP processing and the PayVu technology will also go a long way to avoiding superannuation payments getting lost in the system. If payments get sent to wrong accounts, PayVu will help to get the refund sent directly to employers, not a clearing house, from where it can be re-contributed into employees’ accounts, where it belongs immediately.

Quicker payment of superannuation will benefit employees as they can start earning returns on their money more quickly. As it is now, the refund can end up sitting in clearing houses’ accounts for an indeterminate time, and clearing houses earn interest on this – at employees’ expense.

Employers too will spend much less time administering their superannuation obligations and avoid complicated payment processes, saving valuable time and money.  If you haven’t already, as an employer you should update your payment systems to meet the ATO’s STP requirements and to ensure employees are paid their full wage and superannuation entitlements, on time, all the time, stress-free.

Automation: Opportunity or threat?

By | NPP

What does automation mean for accountants and bookkeepers of the future?

By Robin Beauchamp, CEO, Integrated Payment Technologies (InPayTech).

Accounting and finance professionals not only handle money matters but business strategy and planning. That’s why many chief executives started out as accountants. They understand the importance of the bottom line and appreciate the impact of efficiency gains throughout business operations.

The role of the modern accountant and bookkeeper will inevitably progress beyond the balance sheet and ledger, to provide strategic business insights as automation replaces many of the core tasks they do. Indeed, accountants and bookkeepers are high on the list of service jobs that are being reconfigured by automation.

The flipside of automation is that it frees up time for bookkeepers and accountants to do more of the strategic thinking and business planning that organisations require. Such skills will be increasingly in demand by business leaders who will expect their staff to undertake more sophisticated roles as automation replaces their existing core activities.

That’s why accountants and bookkeepers are investing in their education, acquiring more sophisticated financial and technical skills, and improving their prospects.

According to the 2017 Bookkeeping Business Benchmark Report, conducted by the Australian Bookkeepers Network, bookkeepers are diversifying their service offerings, with a substantial increase in bookkeepers offering more services in management reporting, cash flow statements and budgeting, as well as software analysis and installation.

That has led to profit benefits, with bookkeepers lifting their charge rates in 2017 as they have offered more diverse and sophisticated services than traditional book entry, according to the 2017 report. One of these services is providing software training to clients, which is a service that 62% of bookkeepers now offer to their clients. And as more software is developed, demand for such services will likely grow. That compares to 10 years ago when software training wasn’t a core function of bookkeepers, rather of IT professionals.

So, while automation may initially seem like a threat to accountants and bookkeepers, it can in fact open other opportunities for career progression and service diversification. In this case, it has enabled bookkeepers to increase their charge rates as they diversify into more sophisticated offerings.

Software that has been launched in recent times to help bookkeepers includes PayVu, which bridges the gap between accounting, payroll and banking systems. Software such as this is good news for bookkeepers and accountants as it frees up their time for these significant value-add activities.

And this time saving is important for accountants and bookkeepers. The 2017 Bookkeeping Business Benchmark Report reveals obtaining timely and accurate data from clients and time management are the top two challenges that bookkeepers face. Automation is helping to overcome these constraints.

Marketing and sourcing new clients is another major challenge. Again, automation can help here as it will free up bookkeepers’ time to engage in business development, rather than manual book entry.

PayVu is designed for bookkeepers and accountants and can reduce the time they spend on administration. PayVu features instant display of all due payments from the client accounting system. Payments are selected and sent to business owners via their smart phone for approval or rejection.  Approved payments are immediately sent to internet banking systems and paid.

PayVu’s ability to automate all software and banking logins via secure multi-factor authentication can save a huge amount of time for bookkeepers, who, like every other person on the planet, struggle to remember their log-ins and passwords.

PayVu also links to accounting systems such as Xero, MYOB and Quickbooks and alerts suppliers once payment has been received. PayVu updates and reconciles payments in real time to allow both bookkeepers, their clients and suppliers to avoid any delays in payments.  Payments are processed with two factor authentication security along with full straight-through-processing (STP). This means bookkeepers can stop constantly chasing clients for approvals and feedback.

PayVu is just one example of software that is making life easier for bookkeepers and accountants and freeing them up to add value elsewhere in organisations.

NPP to boost superannuation efficiency and savings

By | NPP

NPP to boost superannuation efficiency and savings

By Robin Beauchamp, CEO, Integrated Payment Technologies (InPayTech).

Australia’s superannuation members will benefit from the New Payments Platform (NPP) as employer contributions are paid more quickly into savers’ accounts and they earn a return sooner. The role of clearing houses could quickly become redundant if employers start making real-time payments directly to workers superannuation accounts.

The NPP is Australia’s new payments system, delivering data rich payments within seconds. Businesses and consumers can transfer funds to recipients real-time on a 24/7 basis, 365 days a year, if that money is being transferred to a person or business who has a registered a ‘PayID’ with the NPP. That PayID will be used instead of a bank BSB and account number and can simply be a mobile telephone number, email, ABN or business name.

The Commonwealth Bank of Australia has released a white paper with KPMG, The NPP and Superannuation, which says the NPP will benefit superannuation members significantly. Based on, for example, a 3% investment return, the switch to real-time payments from the average two-day lag could see total value generated of $19.2 million annually (for 100 per cent of Australian workers’ contributions, based on FY17 contributions of $116.9 billion), the white paper estimates.

Superannuation payments arrive more quickly

Despite SuperStream, superannuation payments are still getting lost in the system because data and monies still move separately under SuperStream, which was developed at a time when payment technology was less sophisticated, according to the white paper. Clearing houses have been managing these problems for superannuation funds and employers, however, this creates cost, complexity and delays in the system.

The NPP offers the potential to smooth out this web of payments, with its infrastructure and overlay services built on top. The NPP enables significantly more information to be sent with payments, allowing senders to attach up to 1,400 fields of data, including Tax File Numbers and ABN, says the white paper. Using that unique PayID for employees, employers will be able to direct funds in real-time to employees’ superannuation accounts and overcome the administrative burden of using a clearing house and keeping up with employees’ changing details.

The employer only needs to know the PayID and the employee becomes responsible for ensuring this is linked to the correct superannuation account at all times. This will make the job of a clearing house redundant – and it will avoid significant delays in the current system which are costing workers, and employers, money.

Need for overlay services

The NPP alone won’t deliver all payment services to superannuation funds. Overlay services will still be needed to add sophistication to real-time payments. Overlays are like apps which enhance or expand the service delivered by the NPP’s basic infrastructure.

InPayTech’s PayVu is an overlay style service that will sit on top of the NPP. PayVu can be used by employers to fully automate superannuation and payroll payments to employees and taxation payments to the ATO. Importantly, PayVu bridges the gap between accounting and payroll systems, and the ATO. PayVu is being integrated with Xero, MYOB and QuickBooks, allowing for the more intelligent processing of payments.

PayVu enables employers to avoid clearing houses and make direct payments to a member’s superannuation fund. This reduces the time it takes payments to go to employees’ funds from an average four days to same day. PayVu will go a significant way to reducing some employers’ lack of compliance with their superannuation obligations.

PayVu complies with SuperStream and that will be on many employers’ minds as mid-year approaches. For employers with 20 or more employees, Single Touch Payroll (STP) reporting of SG payment information will be mandatory from 1 July 2018.

Need for collaboration

The white paper calls on the superannuation funds to take a collaborative approach to developing overlay payment services.

“It is really incumbent on the funds, in collaboration with their bank and the right expert advice, to really understand the pain points and work together to co-design a solution,” says Michael Eidel, Executive General Manager, Cash-flow & Transaction Services, Commonwealth Bank of Australia.

However, collaboration between superannuation funds isn’t realistic. Superannuation funds are like the big banks; that is, they do not co-operate or collaborate; they compete against each other. So, I do not expect this proposal will ever get up. It took legislation and the might of the Australian Taxation Office to push funds to adopt SuperStream. They are hardly likely to raise their hands to work together to develop payment solutions.

This makes the importance of third-party overlay services like PayVu more important.

Benefits of direct payments

The benefits of superannuation payments being made directly from an employer’s own bank account (and not a clearing house) include:

• Giving employers a direct relationship with each employee’s superannuation fund (and vice versa)
• A potential dollar benefit to the fund member
• A benefit to superannuation funds that are able to deal directly with the employer, not the clearing house, which is more efficient
• The direct return of superannuation money into the employer’s bank account whenever the superannuation fund is unable to process the contribution. Currently, returned funds suffer delays through the clearing house being paid, then being reconciled, before returning to the employer.

Another big benefit of STP is that it will help to avoid employers not paying employees super. STP reports Superannuation Guarantee (SG) contributions directly to the ATO when salary payments are made, enabling the ATO to more closely track non-payment. That will take the onus off employees to report non-payment of superannuation. So, the benefits of STP are many fold.

About InPayTech

InPayTech is an ASX-listed technology company that has developed a software as a service system, called PayVu, to help employers meet their new STP requirements. PayVu fully automates payroll, superannuation and taxation payments to the same day and reports these payments to the ATO using STP. Importantly, PayVu reduces the transaction time of superannuation payments from the average of 4.2 days (if a clearing house is used) to payment the same day.

Understanding STP and its benefits

By | NPP

Understanding STP and its benefits

By Robin Beauchamp, CEO, Integrated Payment Technologies (InPayTech)

The Federal Government is arming the Australian Taxation Office (ATO) with additional funding to monitor employers who are not paying correct superannuation guarantee (SG) entitlements to their employees.

Employers’ failure to meet their SG obligations has long been a problem since the introduction of the system of compulsory superannuation in 1992.

A Senate Economics References Committee recently said it is deeply concerned by analysis by Industry Super Australia that suggests employers failed to pay $5.6 billion in SG contributions in 2013-14. No doubt that number has climbed since then given wages and employment growth.

To firmly crack down on this problem, the Government is providing the ATO with additional funding to monitor employers’ non-compliance. The package includes requiring employers to adopt Single Touch Payroll (STP) reporting to to ensure SG payments meet the minimum payment frequency (quarterly) and introducing greater penalties for employers where they don’t pay the right amount of superannuation to their employees.

What is STP?

Single Touch Payroll (STP) involves automating an entire transaction from start to finish by using software to eliminate paper-based work. As payment reporting is fully automated, STP reduces the possibility of reporting errors while introducing greater transparency due to the ATO being able to monitor all aspects of wages and superannuation payments.

In terms of superannuation, the Federal Government will require employers to begin adopting STP for SG payments from 1 July 2018.

The key components of STP include:

  • Employers report on an employee’s salary and wage amounts (including ordinary time earnings) and PAYG withholding amounts to the ATO; and
  • Superannuation Funds report on superannuation contribution information to the ATO at the time payments are received.
  • Employers with 20 or more employees will need to transition to STP from 1 July 2018 with smaller employers being required to adopt STP from 1 July 2019. This will align employers’ payroll function with the regular reporting of taxation and superannuation obligations to the ATO.

The benefits of STP

When employers report their employee’s ordinary time earnings using STP, this will enable the ATO to calculate a reasonable estimate of their employees’ SG entitlements. Where employers aren’t paying the correct amounts, the ATO will be able to step in to require employers to pay their SG obligations. This will reduce the ATO’s reliance on employees to report non-compliance by employers. This is a good thing; often workers may be reluctant to ‘dob in’ their boss or may not even be aware they aren’t receiving the correct amount of superannuation.

The collection of superannuation contribution data through STP will also enable the ATO to display this information in individuals’ MyGov accounts, Australians will therefore have easier access to information about their superannuation via this government platform which houses much of their taxation, medical and other records.

Additional action on super

Other measures the Turnbull Government is taking to enforce SG payments include requiring superannuation funds to report to the ATO more frequently SG contributions received from employers (at least monthly). This will enable the ATO to identify non-compliance earlier and take prompter action against non-compliant employers.

The Federal Government is also improving the effectiveness of the ATO’s recovery powers, including strengthening director penalty notices and using security bonds for high-risk employers, to ensure that unpaid superannuation is better collected by the ATO and paid directly to employees’ superannuation accounts.

The Government is also giving the ATO the ability to seek court-ordered penalties for employers who are repeatedly caught failing to pay their SG liabilities.

The bottom line

STP processing will also go a long way to reducing employers’ non-payment of their SG obligation and reducing this ‘wage theft’, as it has been called.

About InPayTech

InPayTech is an ASX-listed technology company that has developed a software as a service system, called PayVu, to help employers meet their new STP requirements. PayVu fully automates payroll, superannuation and taxation payments to the same day and reports these payments to the ATO using STP. Importantly, PayVu reduces the transaction time of superannuation payments from the average of 4.2 days (if a clearing house is used) to payment the same day.

So, employers will be able to take control and automate the payroll process. No more writing cheques or manually inputting wages and superannuation data.

PayVu will sit as an overlay on top of the New Payments Platform (NPP), which will be launched in November 2017. The NPP will enable businesses and government agencies to make faster payments, with near real-time funds availability to the recipients. Payments will be data rich and fully transparent.

Are Australia’s superannuation payment clearing houses becoming redundant?

By | NPP

Are Australia’s superannuation payment clearing houses becoming redundant?

By Robin Beauchamp, CEO, Integrated Payment Technologies (InPayTech)

Clearing houses have been essential fixtures within Australia’s $2.3 trillion superannuation ecosystem. They make payments on behalf of employers to employees’ superannuation fund accounts. They can save employers considerable time and money. But new payments technology may make clearing houses redundant.

Typically, an employer makes a single payment to a clearing house which then distributes superannuation contributions to employee’s member funds on the employer’s behalf. The administrative pain and complexity of making superannuation payments can be significantly reduced by using a clearing house.

Smaller businesses – those with fewer than 20 employees, or with an annual turnover of $10 million or less – can access the Federal Government’s Small Business Superannuation Clearing House, a free service. Most super funds also provide access to a clearing house service, as well as private super clearing houses, though they may charge fees.

Change is coming

The arrival of the New Payments Platform (NPP) together with automated payment technologies, means change is on the horizon for traditional clearing houses and the companies who utilise their services. The future role for clearing houses as a pivotal component of superannuation fund payments is dramatically diminished.

InPayTech’s own proprietary technology is a good example of the kind of technological advancement that is creating greater efficiencies and reducing cost. Such technologies are disrupting the payments chain within superannuation.

Our product or solution is called PayVu. It is software as a service with the capacity to fully automate payroll, superannuation and all business payments including taxation. Importantly, PayVu removes the payment delay incurred when using a clearing house. When paying superannuation via a clearing house, an average of 4.2 days elapse between the money leaving the employer’s account and arriving at the superfund’s account. PayVu payments are transferred the same day.

PayVu removes the clearing house ‘middle man’ by promoting the straight-through-processing of superannuation payments. It adds immediate ease, efficiency and security to the direct payment of employee super entitlements and gives control over any returned payments back to employer.

PayVu will operate like an overlay of the NPP, which will be launched in November 2017. The NPP will enable businesses and government agencies to make faster payments, with near real-time funds availability to the recipient, on a 24/7 basis, 365 days a year, so public holidays and weekends won’t slow down superannuation payments.

The benefits of using PayVu to automate payroll and super payments from an employer’s own bank account (and not a clearing house) include:

  • Giving employers a direct relationship with each employee’s superannuation fund (and vice versa)
  • Compliance with the Government’s SuperStream reporting regime
  • A potential dollar benefit to fund member (by having their retirement savings monies invested in their super account 4.2 days earlier)
  • A benefit to super funds that are enabled to deal directly with the employer, not the clearing house, which is more efficient
  • Removing any need for employers to manually match data to payments in their accounting software
  • The direct return of superannuation money into the employer’s bank account whenever the superfund is unable to process the contribution. Currently, returned funds suffer delays through the clearing house being paid, then being reconciled, before returning to the employer.

The introduction of this system to Australian small employers has far-reaching efficiency benefits. We continue to explore other applications for PayVu technology beyond the superannuation sphere, and are excited to be focusing for the moment on making the payment of retirement savings far more speedy and efficient for SMEs.

How technology can stop the next payroll fraud

By | NPP

How technology can stop the next payroll fraud

By Robin Beauchamp, CEO, Integrated Payment Technologies (InPayTech).

The Plutus payroll scandal has been labelled Australia’s largest white-collar crime, with increasing calls for additional legislative crackdowns on those entrusted to process the pay, benefits and taxation of working people.

The alleged $165 million Plutus payroll scandal could have been avoided if employers automated payments directly to the Australian Taxation Office (ATO) and authorised taxation payments themselves, rather than relying on a ‘bulk billing’ third-party payroll company to make such payments. Only by authorising payroll payments themselves can employers eliminate the risk of such fraud entirely.

Learnings from the case highlight that payroll is a critical business function which can’t be ‘bulk billed’ without the risk of fraud. Employers need to get it right from the start.

That’s because your payroll is extremely important; it’s the reason why your employees get out of bed every day to be with you – because they get paid. Organisations should therefore keep their payroll authorisations in-house to make sure their employees get paid all their entitlements. Only by authorising themselves can the risk of fraud be entirely eliminated as it takes away the opportunity from third parties to pocket monies intended for others.

Indeed, no amount of additional laws can prevent those third parties with the knowledge, resources and criminal intent to illegally exploit existing systemic loopholes. ‘Bulk billing’ will always carry this risk.

In the Plutus Payroll fraud, the payroll company itself defrauded millions of dollars from employers, money intended for the Australian Taxation Office. While the ATO is still chasing those payments, employers remain out of pocket and liable for those payments that went missing. Trusting Plutus was a bad move. But trusting any third party can expose you to this risk.

That’s why embracing the authorisation process yourself is the safest option. There is a temptation to think the payroll process is too hard and needs to be entirely outsourced by businesses that do not have time to do it. However, this type of thinking can lead to problems. Finding the right technology can make the payroll process much easier – and much more secure if businesses authorise the payments themselves directly to recipients.
InPayTech has developed a unique payments technology, PayVu, which delivers a greater certainty for employers, their agents and the ATO as it fully automates payroll and tax payments. This solution is immediately available to every employer in the nation right now.

PayVu is like an overlay service that will sit over the top of the New Payments Platform (NPP), due to be introduced later this year. The NPP will enable businesses and government agencies to make faster payments, with near real-time funds availability to the recipient, on a 24/7 basis, so public holidays and weekends won’t slow down payments. Each payment message will be capable of carrying much richer remittance information than existing systems.

Importantly, PayVu bridges the gap between accounting and payroll systems and the ATO. The product gives time back to business owners and their bookkeepers by reducing the payment process from hours to minutes and it adds certainty to the outcome by ensuring payments are received by the intended recipients virtually on the same day they are made.

PayVu therefore eliminates the need for employers to outsource the authorisation of payments and it therefore removes the opportunity for illegal behaviour. The massive scale of the Plutus case highlights why it is so important to act now to in-source the authorisation function.

About InPayTech

Integrated Payment Technologies Limited (InPayTech) is an Australian financial technology business that has designed an innovative overlay capability with broad domestic and global applications across banking, wealth management, pensions and financial services.

During its Initial Public Offer process and subsequent listing to the ASX on December 16, 2016, InPayTech highlighted its intention to create new business initiatives to commercialise patents approved and pending around the world. PayVu is the first such initiative from InPayTech Limited.

Understanding the NPP and its benefits

By | NPP

Understanding the NPP and its benefits

The New Payments Platform (NPP) is a national payments infrastructure being developed for the Australian economy. It will give consumers, businesses and government departments a platform to make payments virtually in real time.

In times past, getting access to cash depended on going into a bank during branch hours and withdrawing money.  Today, people can access money via ATMs, EFTPOS, online payments, contactless cards and mobile payments. The NPP will speed up these payments even more, taking them close to real time.

The NPP is being developed collaboratively by 13 financial institutions, including all the big banks and several other banks. Once it goes live later this year, it’s expected that 80 per cent of all Australian bank accounts will be able to receive payments by the NPP. This will increase as more financial institutions connect to the NPP.

Not only will payments be faster, but they will be completed with ‘remittance information’ or details about the payment. Payments will be addressed to a payee’s unique identifier, so there is less chance of money ending up in the wrong account.

How the payments system will work?

The NPP works through three parts:

1. The Basic Infrastructure.
This is a network which will connect all participants.  The network includes a switch, which moves messages between participants and an ‘Addressing Service,’ which enables transaction accounts to be identified by a payment address such as an email address, phone number or ABN number.

2. The Fast Settlement Service
The Fast Settlement Service (FSS) is provided by the Reserve Bank of Australia which enables every single payment made on the NPP to be settled in real-time.

3. Overlay Services
An overlay is a computer network which is built on top of the basic infrastructure.  The NPP infrastructure will eventually support multiple overlay services, which will deliver additional payment services.

The benefits of the NPP:

Customers of financial institutions connected to the NPP will be able to make or receive payments in a matter of seconds.  Real-time settlement means businesses can also make and receive payments more quickly. This will speed up cash flows for everybody.

There will also be less scope for payments to the wrong account. The Addressing Service will enable payments to be directed to any recipient using their phone number, email address, ABN or organisational identifier, even if you don’t know that person’s bank account number.

For bookkeepers, this will reduce the time taken to reconcile accounts. Accounting systems, for example, will be able to match payments against invoices using a person’s payment address.

The platform also enables more information to be conveyed with payments, including the attachment of documents like invoices and receipts.

Questions that you were too afraid to ask:

Q. What’s the point of the NPP?

A. There are three key benefits of the NPP:

  • Speed: the ability to make payments in real time, with close to immediate funds availability to payees outside normal banking hours.
  • Data enriched: the ability to send more information with payments.
  • Simple Addressing: A system to more easily address payments to recipients using their phone number, email address, ABN or organisational identifier.

Q. Who will run the NPP?

A. NPP Australia Limited (NPPA) was formed in December 2014 to build and operate the NPP. The company is owned by the 13 financial institutions participating in the NPP: the ANZ, CBA, NAB, Westpac, Cuscal, ING Direct, HSBC, Macquarie, Bendigo and Adelaide Bank, Citigroup, Indue, Australian Settlements Limited and the Reserve Bank of Australia.

Q. When will the NPP be operational?

A. The NPP is currently being tested by NPP Australia and could become available from November 2017.

Q. Will I pay money to use the NPP?

A. That will depend on your bank. Pricing for use of the NPP will be at the discretion of participating banks and other participants.

Q. Can I move bank accounts more easily?

A. Users of the NPP’s Addressing Service, which allows customers to send payments to a nominated account via a unique identifier, such as a mobile phone number or email address, will be able to switch payments between accounts more easily. So, while the NPP has not been designed to support account switching, it does empower consumers to redirect payments to other accounts through the use of their unique identifier.

Q. What is an overlay?

A. Overlay systems will leverage the NPP’s basic infrastructure and provide tailored payment services. Overlays are like apps which enhance or expand the service delivered by the NPP’s basic infrastructure. NPP Australia, the company formed to operate the platform, predicts the development of several overlay services once the NPP is operational.

Q. What kind of products and services could overlays deliver?

A. As payments made by the NPP will be data rich, the opportunities to speed up payments in funds management, securities trading and in the insurance and superannuation industry are numerous.

The first overlay to be launched on the NPP will be delivered by BPAY via participating institutions. It will be a convenient and accessible service for consumers to send payments from their bank account at any time to payees using addresses such as a mobile phone number or email address, with fast and data-rich availability of cleared funds.

Q. Why is the Reserve Bank of Australia involved with the NPP?

A. Having the RBA connected directly to the NPP will allow real-time settlement between the participating financial institutions.