New Payments Platform. A Technical Overview

Transcription

1 14 September 2017 New s Platform A Technical Overview NPPA Webinar Bob Masina General Manager, Technology & Operations, New s Platform Australia

2 Today s Webinar Will be a technical overview of how the New s Platform works, covering: The architecture of the platform The NPP message set How Overlay Services will work Questions NPP Australia Limited Page 2

3 Where are we in the journey? Sept 2012 RBA s Strategic Review on Innovation in the s System Dec 2014 NPP Australia Limited established June 2013 New s Platform Programme created Feb 2013 Real Time s Committee Proposed Way Forward 2017 Participant and Industry Testing Q New s Platform Open for Progress NPP Australia Limited Page 3

4 How does the NPP work? Connection to the NPP Basic Infrastructure and Addressing Service is via NPPA/SWIFT-supplied s (PAGs) Overlay Services The NPP PAGs are configured to support processing and routing of transactions between PAGs, the Addressing Service and the RBA s Fast Settlement Service Addressing Service Clearing Request and Notification The NPP uses ISO 20022, the global standard for electronic data interchange between financial institutions Payer Bank Channels Settlement Request Settlement Notification Settlement Notification Bank Channels Payee Overlay Services can sit on top of the Basic Infrastructure to offer different customer value propositions and experiences NPP Participants (Financial Institutions) NPP Participants (Financial Institutions) Fast Settlement Service NPP Regulations and Procedures define technical, operational and security requirements and liability for fraud, Misdirected s, Mistaken s and Error s Reserve Bank Information and Transfer Service (RITS) Reserve Bank of Australia NPP Australia Limited Page 4

5 What is PayID? A core, customer facing component of the NPP which is both - an access controlled, secure repository of encrypted customer account information an addressing service which enables Payer Participants to create clearing messages at Payer s request using Payee s easy to remember account proxy Four alias types will be available initially phone, , ABN/business numbers and organisation identifier Customers will register PayIDs in the Addressing Service via their financial institutions (privacy consents will be in place) Registering financial institution responsible for effective, correct, authenticated registration A PayID can be moved easily between accounts and between financial institutions s can be initiated to a PayID or to account details (BSB/account number) If a payment is PayID initiated, the Payer will be able to check the PayID Name linked to the PayID and the account before authorising the payment NPP Australia Limited Page 5

6 ISO20022 Messaging All NPP messages are in the ISO20022 message standard. ISO20022 is a standard for financial messaging using XML syntax. ISO20022 provides a flexible framework to build business transactions by opting for a single, common "language" for all communications as well as the carriage of additional information with a payment. Global Interoperability Rich Data Remittance Uniform and reusable messages NPP Australia Limited Page 6

7 NPP Investigations Initiation Clearing & Settlement NPP Message Types Function Message Type Name Routing head pacs pacs pacs pacs camt pain pain pain pain camt camt camt camt Business Application Header FI to FI Status Report FI to FI Customer Credit Transfer Return Financial Institution Credit Transfer Bank to Customer Account Report Customer Credit Transfer Initiation Customer Status Report Creditor Activation Request Creditor Activation Request Status Report Resolution of Investigation Notification of Case Assignment Proprietary Formal Investigation FI to FI Cancellation Request FI = Financial Institution NPP Australia Limited Page 7

8 NPP Message Types Clearing & Settlement Messages Addressing Service pacs s Clearing and Settlement camt Cash Management Payer Customer Bank Branch Mobile Phone Internet Service Application Payer Customer Inside Basic Infrastructure (BI) PACS.009 PACS.002 CAMT.052 Clearing PACS.008 PACS.002 Settlement RBA Fast Settlement Service PACS.002 CAMT.052 Bank Branch Mobile Phone Internet Service Application 1. Payer initiates a payment via a bank channel (i.e. mobile) 2. Payer s FI can make use of the NPP Addressing service (PayID) in the event the payee uses a PayID 3. Payer s FI sends a pacs.008 to the payee s FI 4. Payee s FI clears the payment and responds to Payer s FI with pacs.002 as confirmation the payee s account is able to be credited 5. Payer s FI initiates settlement by sending pacs.009 to RBA. RBA transfers the value between the two FIs in real-time 6. RBA sends pacs.002 as a settlement confirmation to both FIs 7. Payee s FI credits Payee subject to specific overlay requirements 8. Individual FIs may optionally have a camt.052 sent from the RBA for periodic balance report NPP Australia Limited Page 8

9 What is a Initiation (PAIN) message? Initiation Authorisation Clearing Settlement Post- Fulfillment PAIN message: A non-value message seeking initiation of a payment message Requires authorisation by the account holder prior to clearing message creation Can be sent but there is no requirement for the receiver to action (this is where the Overlay Service Provider would define how it is treated) PACS message: Credit payment message Message for a payment to be cleared and settled Results in the actual movement of funds between accounts Is the responsibility of NPP Participants to execute NPP Australia Limited Page 9

10 How can PAIN messages be used? End User? Submitted to BI via? How authorised by Account Holder? End customer Participant Corporate Fintech Agent/service provider Merchant End users can submit PAIN messages to the NPP Basic Infrastructure in different ways Participants Identified Institutions Connected Institutions and Connected Overlay Service Providers (via own PAG) The PAIN must be authorised for the payment to be actioned. This can be done (implicitly or explicitly) by mechanisms such as: Account holder approval on a transaction by transaction basis (e.g. pop-up screen ) Mandate process (typically used by merchants) One off, rules based Standing/recurring Transaction Negotiation Authority (TNA) standing authorisation (agent/service provider/bureau) Corporate commercial relationship PAIN messages can be used in a variety of ways and to suit a different range of use cases NPP Australia Limited Page 10

11 NPP Message Types PAIN Messages pain Initiation Organisation Initiation PAIN.001 PAIN.002 Bank Channels Inside Basic Infrastructure (BI) Addressing Service PACS.009 PACS.002 Clearing PACS.008 PACS.002 Settlement RBA Fast Settlement Service PACS.002 Bank Channels 1. Organisation sends pain.001 to FI 2. Organisation s FI can make use of the NPP Addressing service (PayID) in the event the payee uses a PayID 3. Organisation s FI sends a pacs.008 to the payee s FI 4. Payee s FI clears the payment and responds to Organisation s FI with pacs.002 as confirmation the payee s account is able to be credited 5. Organisation s FI initiates settlement by sending pacs.009 to RBA. RBA transfers the value between the two FIs in realtime 6. RBA sends pacs.002 as a settlement confirmation to both FIs 7. Payee s FI credits Payee subject to specific overlay requirements Payees NPP Australia Limited Page 11

12 NPP Message Types NPP Investigations Financial Institution A Addressing Service Financial Institution B Investigation camt Cash Management Back Office Processing CAMT.035 CAMT.029 Back Office Processing 1. Financial Institution A advises Financial Institution B of formal investigation by sending camt Financial Institution B sends camt.029 to Financial Institution A once investigation has been resolved Inside Basic Infrastructure (BI) RBA Fast Settlement Service NPP Australia Limited Page 12

13 NPP Message Usage Framework New s Platform ISO Schema Innovation Layer (Available for Future Overlays to Define) Example: Osko & pacs.008 ISO Schema: Unstructured Remittance Information limited to 2 x 140 characters Related Remittance Information - to carry the URL of an externally hosted document Foundation Layer NPP Core Elements (cannot be altered) Overlay Service Providers can build upon the foundation layers of ISO NPP message usage to develop new innovative services NPP Australia Limited Page 13

14 How does an Overlay Service work? Overlay Service Provider defines the message set and data content to be used and how the flows will work (could be simply rules based or could involve a change to the current message set) Service is offered to Participants and their customers Once approved by NPPA, overlay service will be added to a closed user group with those Participants who choose to subscribe to the service Overlay Service Provider manages ongoing governance and membership of service Can be connected or non-connected to the Basic Infrastructure NPP Australia Limited Page 14

15 NPP s First Overlay Service NPP Australia Limited Page 15

16 NPP Overlay Service Osko by BPAY Payer Customer Bank Branch Mobile Phone Internet Service Application Payer Customer Inside Basic Infrastructure (BI) Addressing Service PACS.009 PACS.002 CAMT.052 Clearing PACS.008 PACS.002 Settlement RBA Fast Settlement Service PACS.002 CAMT.052 Bank Branch Mobile Phone Internet Service Application Quicker moving money funds received in less than 1 minute More ways to address a bank account no need for account details when using PayID Easier messaging more explanation with up to 280 characters or a document url Ability to request to be paid simple requests with up to 280 characters using PayID Confidence in Delivery customer can receive immediate confirmation Through your FI Osko will be in the majority of FIs mobile and internet banking platforms Easy to track if requests have been paid easily track and reconcile which payment requests have been paid in full or part Confidence in who you re paying or sending a request to PayID name is displayed to confirm intended recipient NPP Australia Limited Page 16

17 Osko by BPAY Customer Journey: Making a Bank Logo Bank Logo Enter PayID: PayID name: Company ABC Log in Confirm Eva wants to make a payment to Company ABC of $250 Eva logs into her FI s mobile banking app or internet banking Eva selects Osko as her preferred payment channel and enters details required for a payment Eva enters Company ABC s PayID to direct the payment. Eva s FI sends a request to PayID to retrieve the account details A short name may be returned to help Eva confirm she has the correct recipient. Eva confirms and makes the payment The payment is sent via the NPP to Company ABC s bank account. Eva receives a confirmation that the payment was successful Company ABC has $250 deposited into their bank account and the funds are available for immediate use NPP Australia Limited Page 17

18 NPP Australia Limited Page 18 Examples

19 Example 1: Payroll files (outside of the BI) End Customer Authorisation Corporate Customer Payroll File Salary s Confirmation Could either be independent of an overlay or part of an overlay Payroll file pain.001 Payer Customer Bank Bank Channels Within NPP Basic Infrastructure Clearing using NPP pacs.008 or Overlay defined pacs.008 FI s with Payee Accounts Bank Bank Bank initiation messages could be sent from third parties, containing structured payroll data elements, e.g. Employer ID, Gross Income, Tax withheld etc. These structured data elements are carried through into the Clearing message or referenced via a url to an external data source if using an Overlay Service s can be cleared and settled in close to real-time, 24x7 would receive both the payment data and payment linked together (if using an Overlay Service) NPP Australia Limited Page 19

20 Example 2: Connected Overlay Service Payroll Connected Overlay Payroll Bureau with own PAG Overlay pain.001 FI s with Payer Accounts Payer Customer Bank Clearing using overlay defined pacs.008 FI s with Payee Accounts Bank Payer Customer Bank Bank Confirm Payer Customer Bank Bank End Customer Authorisation Within NPP Basic Infrastructure initiation messages sent directly to Overlay subscribed NPP Participants, containing structured payroll data elements, e.g. Employer ID, Gross Income, Tax withheld etc. These structured data elements are carried through into the Clearing message or referenced via a url to an external data source s can be cleared and settled in close to real-time, 24x7 would receive both the payment data and payment linked together NPP Australia Limited Page 20

21 New s Platform Key Takeaways Available 24 / 7 / 365 Will be world-class using ISO20022 messaging Data and payment travel the NPP together Ability to use PayID instead of remembering my BSB and Account number Real-time clearing and settlement NPP Australia Limited Page 21

22 NPP Australia Limited Page 22 Questions

23 Thank you For more information please contact the NPPA team on NPP Australia Limited 2017 NPP Australia Limited (ABN ) Disclaimer: This presentation is for general information purposes only. Neither this presentation, nor any information contained in it, shall form the basis of any contract between NPP Australia Limited and any person, nor constitute a commitment by NPP Australia Limited to any person.