Real-time payments coming to Australia in 2017

Sick of waiting days for fund transfers to go through? Those days are numbered.

Mike King

Mike King is a Fool.com.au Investment Analyst and Writer. He caught the investing bug more than a decade ago, at a time when the U.S. had invaded Iraq and fear reigned in the markets. His initial success as the markets took off encouraged his passion and thirst for knowledge. With 13 years behind him at one of Australia's largest domestic banks, Mike's passion for stocks led him to join a boutique funds management firm, where he stayed for four years. A seven-year stint in equity research at one of the largest investment banks in the world followed that, giving Mike a thirst to pursue his passion further. Mike holds a Diploma in Applied Finance and Investment and a Graduate Certificate in Financial Planning. His passion is to help retail investors invest better, and that passion was one of his primary reasons for joining The Motley Fool Australia in late 2011. Mike has written thousands of articles since joining, including for Fairfax Media, Yahoo!7, Ninemsn and has also appeared on ABC's The Business. You can see all of Mikes' holdings here

Published October 14, 2016 3:20 pm AEDT

Sick of waiting days for a transfer to go through from one bank account to another at a different bank?

Me too.

Well, those days are officially numbered according to the Reserve Bank of Australia (RBA). A new payments platform (NPP) will allow bank customers to transfer funds in real time using just a phone number or email address, 24 hours a day, by the end of 2017, according to the central bank.

Thirteen of Australia's largest financial institutions, including Australia and New Zealand Banking Group (ASX: ANZ), Commonwealth Bank of Australia (ASX: CBA), National Australia Bank Ltd (ASX: NAB) and Westpac Banking Corp (ASX: WBC) are working with international telecoms cooperative SWIFT, which is building the infrastructure. SWIFT already facilitates billions of international interbank transfers and secured communications.

The RBA is doing its bit as well, building a Fast Settlement Service (FSS).

And before you think this is still a long way away, basic test payments are already being made through the FSS and SWIFT's infrastructure. BPAY has been appointed as the first overlay service to use the NPP.

NPP Australia says it remains committed to launching the NPP in late 2017.

This is also a much more sophisticated system, allowing much more information to be transferred alongside the funds. Invoice payments could be transferred alongside the invoice, perhaps allowing the details to be imported into accounting systems.

That will have implications for the likes of accounting software providers Myob Group Ltd (ASX: MYO), Reckon Limited (ASX: RKN) and Xero FPO NZX (ASX: XRO). Customers are likely to want as much information as they can get, and the new payments platform should make fund transfers 'data rich' and easily addressed.

Personally, I can't wait.

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