PayTo is live at 50 financial organisations

Over 50 organisations are now live with the digital direct debit PayTo service with banks and financial institutions either onboarded or on-track to meet an April activation deadline.

Developed by NPP Australia alongside the finance industry, PayTo allows businesses to initiate payments from customers' bank accounts as part of a ‘PayTo Agreement’.

PayTo began rolling out last June with customers predicted to have access to PayTo in their bank accounts by the end of April, following an extension by the Reserve Bank of Australia in 2022.

Multiple banks - including the likes of the Commonwealth Bank of Australia, Bendigo and Adelaide Bank and Great Southern Bank - are already live with the service.

Others say they are completing readiness testing in preparation for an on-time launch.

An ANZ spokesperson told iTnews the bank is “on track to deliver PayTo to our retail and commercial customers shortly.”

NAB's executive for transaction banking Jonathan Adams said the bank supports “the RBA’s initiative and expects that necessary work is completed by April 2023."

“We look forward to helping customers access new simple and digital real time payment experiences,” Adams said.

NAB is currently notifying all customers with eligible NPP bank accounts and has started to engage some customers. It is also working with a small number of them to pilot its merchant proposition later this year.

Westpac is also understood to be on track with its PayTo requirements for the end of April deadline. 

An Australian Payments Plus (AP+) spokesperson told iTnews that around 50 organisations are now live with the PayTo service “including a number of third parties offering PayTo payment initiation services.”

“The remaining banks and financial institutions not yet onboard are progressing well towards going live in the coming months and in preparation a number of banks have publicly announced changes to their product terms and conditions to their customers,” the spokesperson said.

The spokesperson said AP+ expects “to see the majority of NPP reachable accounts enabled for PayTo by the middle of the year”.

“[This means] the majority of retail banking customers will be able to authorise and manage PayTo agreements within their banking channels by that time.”

Each organisation had specific plans and timing for enablement, owing to the "complex, multi-year programme of work" needed to enable PayTo.

It required "significant change to a bank’s technical systems, customer facing digital channels and back-office processes," the AP+ spokesperson said.

“Given the complexity of the work, inevitably issues arise as the banks work through their delivery programmes that can unfortunately impact on timing.”

However, the AP+ spokesperson added it's already starting to see some early use cases emerge in the market “such as Hello Clever and Wagepay”, two fintech startups whose merchant customers utilise the PayTo capabilites.

AP+ expects “to see more use cases emerging over the coming months as the rollout of the service continues, including the migration of existing direct debit arrangements, utility payments and ecommerce and in-app payments.”

iTnews understands so far around 40 organisations have enabled PayTo for their payer customers - people wanting to make PayTo payments to businesses.

Another 12 organisations are currently offering payment initiation services and looking at a range of use cases.

In total, PayTo will be eventually rolled out by roughly 105 NPP participating organisations. 

Other financial organisations already on the platform include Defence Bank, Police & Nurses, Bank Australia, BankWAW, First Option Bank, Horizon Bank and RACQ Bank, and Broken Hill Community Credit Union, Credit Union SA and Laboratories Credit Union.

Payment service providers said to have rolled out the service include Azupay, Ezypay, Monoova, Paypa Plane, Zai and Zepto.