New Payments Platform – Australia’s Transformational Journey to Meet the Needs of Tomorrow

Australian’s will soon experience a financial evolution with the launch of the New Payments Platform (NPP) providing a fast, versatile, payments system for near ‘real-time’ transactions any time of the day, any day of the year.  Think of it your traditional overnight Electronic Funds Transfer (EFT) turbocharged!

For financial institutions keen to provide simpler and smarter ways to enhance customer experiences together with improved and agile business operations, the NPP provides a solid infrastructure from which they can enable innovation and drive competition in payments services.

Let’s use the Five W’s and One H approach to understand the New Payments Platform.

The NPP involves a world class payments infrastructure designed to meet the evolving needs of a 24/7 digital economy in Australia. It provides customers, businesses and government departments the ability to make quick and immediate payment exchanges between participating financial institutions.

The platform enables real-time clearing and settlement for payment solutions between 2 or more accounts. It basically brings simplified, secure, professional level funds transfer to the masses via an ‘easy-to-remember’ identifier, known as PayID, to create a seamless process.

Furthermore, the NPP will evolve over time with ‘overlay’ capabilities providing for tailored services which individual financial institutions may develop to offer their customers. This ensures the NPP will be equipped to meet the evolving needs of Australians in the digital age – and beyond.


The NPP is being developed by a group of Authorised Deposit-taking Institutions (ADI’s) in response to the 2012 review of the Australian payments system led by the Reserve Bank (RBA).  This review highlighted a range of features which were desirable in the Australian payments system, with a high priority for the capacity to make and settle payments in real-time.

In addition, the RBA detailed the gaps in the payments market especially Australia’s digital lag behind other developed economy’s and challenged the industry to respond. The result, a recommendation for a new layered business architecture for payments clearing and settlement, together with a system that offered a range of new real-time payment services to customers, businesses and government.

NPP Australia Limited (NPPA) was formed in December 2014 with 13 financial institutions collaborating to build and operate the NPP (1).  Many of them will support payments on the platform as soon as it goes live, with others to gradually introduce their services over the following months.  In addition, a large number of smaller financial institutions will connect to the platform capabilities through one of the initial NPP participants after the launch.

The platform simply acts as a secure network between the participating financial institutions enabling messages to be sent in real time for funds to be transferred between accounts with immediate settlement.

Being built from the ground-up, the NPP’s open and layered infrastructure is scalable for the future and can be accessed by organisations looking to create a faster and more efficient way of conducting business.  There are several key innovative features to note:

  • Enhanced data capability through the application of ISO20022 – the global standard for electronic data interchange between financial institutions). This provides maximum flexibility in automated data processing with the ability for more information to be imbedded into payment messages and links to externally hosted documents;
  • The platform’s architecture which enables organisations to develop payment products or services ‘on-top’ to leverage its capabilities – known as Overlay Service Providers. The platform has the potential to support multiple and competitive offerings, making it a potential breeding ground for innovation;
  • PayID – a unique ‘address’ that allows people to securely link their financial accounts to a more memorable piece of information, eg. mobile phone number or email address, allowing quick and simple transfer of funds between accounts.


Osko by BPay  is the first overlay service purpose built to leverage the capabilities from the NPP and will transform the way people pay each other.  This will be offered to customers via their digital banking channels, initially allowing them using their PayID, to securely make and receive instant payments, 24/7, 365 days a year, transforming the way they pay other.

Currently in final testing stages, the NPP is expected to be operational for the Australian public in early 2018.  This will commence with the launch of Osko by BPay.

The NPP will operate on an opt-in basis so there is no guarantee every ADI will participate in the available infrastructure offerings when the service goes live.  However, with over 70 financial institutions confirming they will initially adopt or connect to some or all of the technology services, consumers will be empowered with convenience and choice for their payment options.

Innovation for Tomorrow
The NPP has been designed to meet the evolving expectations of customers in the digital age, by allowing for “always on, always open” payments across the financial system.  As businesses continue to digitise their back-offices and introduce rich data services for customers, the NPP becomes a building block to enable the delivery of the digital integration required.

All ADI’s therefore have the ability to capitalise on these capabilities provided by the NPP, especially the overlay services, not only for technology developments and digitalisation, also the associated customer experience enhancements.

Fintech companies like Cashwerkz, are well placed to collaborate with ADI’s and complement this new platform as they have the ability to lead with agile innovation at a far greater rate than traditional financial institutions.  Added to that, embracing the NPP capabilities becomes a definitive step to transform the customer experience in the investment process, replacing the ‘minimum of 5 day funds transfer’ with instant payments to streamline administration procedures.

These opportunities will provide greater tailored services for both financial institutions and other innovators, from those which have already been confirmed to others that we may not yet be able to imagine.  Stay tuned!

(1) ANZ, CBA, NAB, Westpac, Cuscal, ING Direct, HSBC, Macquarie, Bendigo and Adelaide Bank, Citigroup, Indue, Australian Settlements Limited and the Reserve Bank of Australia.




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