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The wait is almost over…

Over the coming months you should start to see PayTo appear as an alternative to direct debit and an option for online, in-app and recurring payments. 

Developed by New Payments Platform (NPP) Australia in collaboration with financial institutions, fintechs and payments providers, PayTo is the culmination of years of hard work aimed at improving account-to-account payments.

The NPP has said the first payment service providers to offer PayTo to merchants and businesses include; Azupay, Ezypay, Monoova, Paypa Plane, Zai and Zepto. Additionally, the first financial institutions to enable payer customer accounts are; BankWest, Bendigo Bank, the Commonwealth Bank of Australia, Great Southern Bank, People’s Choice Credit Union (PCCU), RACQ, and the Reserve Bank of Australia’s Banking department. 

For those remaining customers– stay tuned! PayTo will be enabled in your accounts by April 2023. 

Why choose PayTo?

PayTo addresses a number of pain points associated with direct debit:

  • Direct debits are slow to set up and it can take days to make or receive a payment. 
  • Payment failures due to human error or insufficient funds lead to dishonour fees, increased customer churn and operational costs for businesses. 
  • Payment agreements are time consuming to update because changes must be made manually. 

Most importantly, PayTo creates real value for businesses and consumers alike.

Benefits to business 

PayTo will help improve cash flow and increase process efficiency by allowing businesses to make and receive payments in real time, and process payments any time of the day or night.

PayTo also allows accounts to be validated in real time, removing the possibility of failed payments due to incorrect account detail entry, and increases efficiency by reducing manual handling. Additionally, because payments are authorised through the customer’s banking app, it reduces the risk of fraud. 

Businesses will also have greater visibility over the payment cycle. No more waiting and guessing, they will be notified whenever a payment is paused, changed or modified by the consumer.

Benefits to consumers

PayTo can be used for all kinds of payments, including recurring bills that were typically paid through direct debit, or online purchases that previously used cards.

PayTo allows consumers to pay directly from their bank account and view all of their PayTo agreements in one location, via their banking app, giving them full visibility and control.

Consumers are easily able to set up a PayTo agreement using their BSB and account number, or their PayID– no more remembering card details. They can check and approve the payment terms via their banking app or online banking system, before money is debited from the account. If there are any changes to a PayTo agreement, consumers will be asked for authorisation through their banking app.  

And, because PayTo agreements are located in a consumer’s banking app, their information is protected by the same level of security as their banking data– win-win. 

Find out more

Want to find out more about the nuts and bolts of the consent process for direct debit versus PayTo? Take a look at this explainer


Article Sources

Basiq mandates its writers to leverage primary sources such as internal data, industry research, white papers, and government data for their content. They also consult with industry professionals for added insights. Rigorous research, review, and fact-checking processes are employed to uphold accuracy and ethical standards, while valuing reader engagement and adopting inclusive language. Continuous updates are made to reflect current financial technology trends. You can delve into the principles we adhere to for ensuring reliable, actionable content in our editorial policy.