Australasia Paytech Trending

GoCardless Sets the Scene for the Arrival of PayTo in Australia

GoCardless goes live in the Australian payments market with PayTo. 

The direct bank payment solutions provider GoCardless is going live with PayTo in Australia, the account-to-account payment network. This is in anticipation of PayTo superseding direct debit within three to five years.

PayTo is a new digital way to pre-authorise one-off and recurring payments. It’s being developed by the Australian financial systems using the redesigned payment capabilities of the New Payments Platform.

With PayTo, customers are granted more control over payments coming directly from their bank account. PayTo agreements are viewed and managed from within an existing digital banking app.

It’s seen as favourable among merchants as it initiates and improves the reliability of payments. Additionally, the platform has the potential to greatly reduce hidden fees, merchant costs, fraud and failed payments.

PayTo is already being welcomed by Australia’s payments industry as it increasingly transitions away from traditional direct debit. This shift is being driven primarily by a demand for greater accuracy and speed in current systems.

This need is especially pronounced when businesses need to update payment agreements or validate the payment before the direct debit agreement starts.

The PayTo solution is already available across more than 29 million bank accounts across 40 banks.

PayTo ready

While some financial services within Australia are already ‘PayTo ready’, GoCardless is the first provider of its scale and international presence to go live with the payments infrastructure. The new payment option is being presented alongside direct debit within its payments tech stack.

This addition allows GoCardless to provide a range of additional functionality such as refunds and international payments, with the option to sit side by side with traditional payment methods.

According to the company’s State of Pay report, 51 per cent of businesses want to reduce payments processed by credit card. Similarly, 52 per cent of consumers would use a new payment technology if it were more secure.

GoCardless GM of Australia and New Zealand, Luke Fossett, says the GoCardless team are thrilled to have gone live with ‘the future of payments’.

“This is a significant milestone for us. We’ve advocated PayTo since its design and inception a few years ago,” he comments.

The company launched PayTo Uni earlier this year to educate consumers and merchants on everything PayTo. What it is, why it exists and the benefits of the technology are all key topics involved in this initiative.

“To now be helping merchants in Australia to make PayTo available gives us great pleasure,” Fossett continues.

With the conventional direct debit system set to be replaced by PayTo in the coming years, Australian businesses are being urged to come to terms with PayTo and integrate it into their payments infrastructure early.

“The eventual industry-wide adoption of PayTo will allow businesses to adjust their payment systems to benefit both themselves and their customers,” Fossett adds.

“I think we’ll see some significant industry-wide improvements in the months following the NPP April deadline for PayTo integration.”

Author

  • Tyler is a fintech journalist with specific interests in online banking and emerging AI technologies. He began his career writing with a plethora of national and international publications.

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