THREE of the big four banks will start rolling out a near real-time payment system from Tuesday, as the biggest overhaul of payments infrastructure in two decades is launched to the public.
Commonwealth Bank, Westpac and National Australia Bank said that from Tuesday, they would start offering customers the ability to make money transfers that will settle within less than a minute, compared with today, where it can take up to three days for funds to arrive.
The new system also allows customers to transfer money to an external account without entering a BSB or account number.
ANZ Bank, however, is not launching the service to its customers yet, saying it is continuing with "rigorous testing" of the new system, to ensure customers got the "best possible and safest experience." ANZ would announce how it will rollout the fast payment system to its customers in the coming weeks, a spokesman said.
As well, some of the other major banks that are launching the new system on Tuesday will not make all of its features available to all of their customers straight away.
In the case of NAB, it will be a staggered rollout, that will result in all of its customers having access to the new system, known as the new payments platform, over the coming month.
"Within the next month, all NAB customers will be able to create and use PayID through their Mobile Banking App, Internet Banking, and NAB Connect," said Rachel Slade, executive general manager of deposits and transaction services.
Westpac is also only initially launching the NPP to some of its customers - those in the Westpac-branded bank.
It will roll out the new payments platform to other brands, such as St George, Bank of Melbourne, and BankSA, "over time," a spokeswoman said.
"Westpac’s approach has always been to deliver a safe, secure and reliable transition for customers and the industry,” the bank said.
CBA's spokeswoman said the new service would be available to customers from day one. "Commonwealth Bank customers can now send and receive payments in real time with other financial institutions through the New Payments Platform which launches today," she said.
As well as faster payments, the NPP also promises to allow consumers to transfer cash to a person or business without entering in the recipients BSB or account number.
Instead, consumers will be able to create a "PayID" - which allows customers to link their bank account to an email address, phone number, or business number, for example. The service allowing consumers to make faster payments using their "PayID" has the brand name "Osko."
The NPP is a $1 billion project, launched with support of the Reserve Bank, which has involved revamping the infrastructure that facilitates millions of payments between consumers and businesses.
“We know that Australians are frustrated about the amount of time it takes to move money between accounts at different banks, which can sometimes be as long as two to three days," the chief executive of NPP Australia, Adrian Lovney, said.
Mr Lovney said the NPP was not being launched as a "big bang" because its impact would be felt across the economy.
"We're estimating that by the end of the ramp-up period... 80 per cent of Australians' accounts will be connected," he said.