eftpos unveils its Australia-first digital product strategy

Spearheading innovation & collaboration across members, Fintechs and retailers eftpos today announced an updated digital product and technology strategy for rollout over the next two years, which aims to change the daily lives of Australians for the better. The strategy also provides greater clarity to members, Australian Fintechs and retailers about opportunities for innovation and collaboration.

eftpos CEO Stephen Benton said the strategy aims to create greater value, ease and security for consumers and businesses by enabling compelling innovations for members, Fintechs and retailers that enhance the digital commerce experience.

Mr Benton said much of the work was already well underway and the business was deeply engaged with members and industry participants to finalise detailed rollout schedules over the next two years.

The digital strategy has five key elements:

  • Mobile Wallets
  • eCommerce
  • Digital identity
  • APIs and Fintech access
  • National QR code payments rollout

“The eftpos digital product strategy has been devised with an Australian focus, creating world-class innovations to compete against global players. The strategy we embarked on two years ago aimed to transition eftpos from a card present retail business to a major player in the centre of Australian eCommerce that leverages our world-class technology investments,” Mr Benton said. “It’s been a journey not without challenges, but it has come together better than we could ever have hoped, with a keystone being the recent acquisition of Beem It.

“In many ways, eftpos was Australia’s first Fintech and our digital strategy builds on that history to deliver on eftpos’ purpose – to do good for Australia. We aim to do this by engaging with members, Fintechs and retailers to make everyday payments easy, secure, smart and cost efficient.”

Mr Benton said the growth of debit card transactions in Australia made eftpos’ digital strategy even more important for competition and innovation.

Debit cards is where competition is thriving in Australia today. Debit cards are by far the most popular payment choice for Australians as they move from cash and credit during this challenging time. Of the almost one billion electronic transactions per month in Australia, around 70% are now on debit and that number is growing every month.

Many of the digital initiatives leverage eftpos’ centralised payments infrastructure, the eftpos Hub, that was built in late 2014 and our Token Service Provider that went live in 2016. Together, these assets provide locally-based, world-class, secure and accessible real time payments infrastructure. The resilient Hub infrastructure has been running at zero downtime since launch and enables local Fintechs and financial institutions to access, innovate and compete on top of the eftpos payment rails.

The rapid pace of our transformation agenda means new initiatives are being introduced swiftly to encourage competition and innovation during the nation’s economic recovery, and at a low cost due to its accessible design and our use of global standards that facilitate choice. 

Digi Ecommerce
17-12-2020
Digital Product Strategy

eftpos, BPAY Group and NPPA propose to amalgamate

  • eftpos, BPAY Group and NPPA to be preserved as distinct operations under a single Board with a shared roadmap for innovation and investment
  • A unified group will aim to improve choice, competition, innovation, efficiency and affordability of Australia’s payments system
  • The proposal is subject to ACCC approval, including a period of public consultation prior to determination

Australia’s three domestic payment organisations, eftpos, BPAY Group and New Payments Platform Australia (NPPA) intend to amalgamate, creating a stronger, unified entity (“NewCo”) that will aim to reduce costs, increase innovation and efficiency, and be better able to compete with the growing scale of overseas multinational payment platforms.

In Australia, international card schemes and multinational technology providers are dominating the payments sector. Change is needed to ensure that the Australian payments system supports the best interests of consumers and businesses, through increased choice and competition.

The proposal to amalgamate will seek to realise tangible benefits for consumers and businesses, including a continued rollout of eftpos’ existing online capability, which seeks to give Australian retailers and consumers a low-cost option when purchasing online.

A single Board will utilise the strengths of each organisation: including BPAY Group’s innovation capability, eftpos’ low cost, real time retail payments and digital innovation capability and NPPA’s real-time infrastructure management capability.

The proposal was made by an Industry Committee comprising 13 mutual shareholders and eftpos members across the three entities. The Committee was established following the RBA’s Review of Retail Payments Regulation Issues Paper, which noted consolidation of some domestic payment groups should be considered. After a four-month period of deliberation, the Committee unanimously supported the amalgamation proposal.

Industry Committee Chairman, Robert Milliner, said a new, strong entity is needed to shape payments in Australia and provide sustainable competition to global payment companies for the benefit of local consumers and businesses:

“An efficient, innovative and competitive Australian payments system is vital for consumers and businesses, both large and small. The model proposed will enable us to adapt faster to the changing trends of the digital economy, while preserving and strengthening the components of our payments system that so many Australians value and rely on.”

“eftpos, BPAY Group and the NPPA provide Australians with reliable, safe and affordable payments options every single day. Working together towards common goals, they can unlock incredible value, invest more in innovation and realise cost-savings that will ultimately benefit the Australian public.”

eftpos, BPAY Group and NPPA will be preserved as distinct operations in a new combined entity with a single Board which will determine a NewCo management structure. Customers will continue to have access to the existing payments methods they know and trust; including BPAY, Osko, eftpos, Beem It and PayID. Each entity will continue to have its own operating governance and management schemes.

Benefits of the proposal

Amalgamation will aim to address current inefficiencies in the system, by creating a NewCo that provides multi-service infrastructure, broad capability, low cost of acceptance and a unified roadmap that is responsive to changing consumer expectations and technological advancements.

The combined entity will aim to deliver substantial benefits while also protecting the value and brands of eftpos, BPAY Group and NPPA. NewCo will aim to:

  • Apply downward pressure on payment costs: A unified domestic payments entity will foster low cost real-time account to account and eftpos debit card form factor payments and seek to bring average merchant fees down further.
  • Encourage and enable more payments innovation: Working towards common goals, joint investments can be made in new and existing payments infrastructure and services.
  • Enhance competition: Through increased scope and scale, NewCo’s goal will be to provide sustainable competition to global payments companies in a rapidly evolving payments landscape.
  • Improve efficiency and speed to market: Via reduced duplication, the unified roadmap aims to improve efficiency and speed to market of new innovations to meet unmet consumer needs.

Unanimous shareholder support

The Boards of eftpos, BPAY Group and NPPA have executed an agreement to implement NewCo subject to obtaining ACCC authorisation. eftpos Managing Director Stephen Benton said:

“For over 35 years, eftpos has been giving Australian customers and businesses access to reliable, affordable and safe payments. We pride ourselves on offering customers low cost acceptance options and intend to continue to deliver this. This proposal should allow us to continue to expand our online digital capabilities and innovation in areas such as digital identity, QR codes and mobile wallets including extending the role of Beem It to be an everyday lifestyle app.”

BPAY Group CEO John Banfield said:

“BPAY Group has been at the forefront of collaborative innovation within the Financial Services sector and beyond for decades. Our more recent recognition such as one of Australia’s Best Workplaces, AFRs Most Innovative Companies, Best Product Innovation is a clear strategic advantage for the Board of NewCo as it transforms into an entity that can literally take on the world, should the ACCC agree that this is in the public’s interest or otherwise approve it.”

NPP Australia CEO Adrian Lovney said:

“The COVID-19 pandemic has accelerated the pace in which the payments system is evolving. The increasing trends away from cash to online and in-app purchasing highlight how important it is for Australia’s domestic payments players to work together and invest in the current and future needs of Australians and how they want to pay.”

The new structure A single Board of 13 Directors will govern the operation of NewCo – comprising four independent Directors including the Chair and nine representatives from the major banks, smaller banks and non-ADIs (such as retailers and other payment processors). Each Director will have one vote, the major banks will have 4 out of 13 votes.

While arrangements could evolve over time with the approval of the shareholders, a key feature of the proposal is that the individual interests of the three entities will be protected. Fundamental decisions about the operation, funding, or future of any of the three schemes would be subject to determination by those shareholders that use that particular system. Retailers and other users of the eftpos system, for instance, will retain specific veto rights over any proposals that would directly impact eftpos.

The proposal also requires that each organisation’s existing payments-related work program remains unchanged until at least June 2022. This includes:

  • Extending eftpos acceptance online and in-app, and broadening of Beem It use cases;
  • Development of QR codes in accordance with an agreed standard and in coordination with relevant entities;
  • BPAY Group roadmap including making BPAY fully available through Application Programming Interfaces (APIs) and the further development of its Osko service; and
  • NPP Australia’s Mandated Payments Service which will enable authorised third-party initiated debits from more than 72m Australian bank accounts via a single connection.

A formal authorisation application will be filed with the ACCC in March 2021. The application will provide full details of the proposal and rationale. It will be made publicly available and subject to broad public consultation before the ACCC makes a determination within 90 days.

handshake
15-12-2020
handshake

eftpos signs deal to buy Beem It

Australia’s debit payments company, eftpos, today announced it had purchased Beem It, the Australian payments App that enables consumers to send and receive money using their phone in seconds, regardless of who they bank with.

eftpos CEO, Stephen Benton, said the signing was a logical move for eftpos as a trusted Australian payments brand that has access to hundreds of thousands of Australian merchants, millions of consumers and is quickly moving into digital payments.

“We are very excited to complete this purchase as a key element to eftpos’ strategy to diversify and move further into the digital ecosystem,” Mr Benton said.

“Australians are rapidly moving much of their daily lives to mobile and Beem It is a great Australian-owned and operated option for them to embrace digital payments. It’s easy to use, secure and free to download.

“In many countries, mobile wallets are the main App for day to day life, particularly throughout Asia and the Nordics. These Apps make life easier and add value, seamlessly and securely.

“eftpos the payment system will remain wallet agnostic and be the rails that support a variety of digital wallets.”

As at the end of August 2020, there had been 1.4 million downloads of the Beem It App, with ratings remaining consistently high, up to 4.9 out of 5.

Mr Benton said that looking forward, Beem It, along with other eftpos assets such as its digital identity solution, connectID, could be utilised to create compelling innovations for consumers, merchants and banks to enhance digital commerce while leveraging existing industry investments.

A spokesperson for the sellers said: “Today’s announcement marks a significant step forward for the future development of Beem It and the expansion in the use of digital wallets as a whole in Australia. Since its launch as a start-up business just two years ago, Beem It has proved to be extremely popular with over one million downloads and hundreds of thousands of regular users, particularly its instant payment, split bill and expenses tracking features.

“Its innovative technology is a formative example of the creative ideas and opportunities that have opened up in the area of Australian payments in recent years and we’ve been delighted to support the company in offering exciting new ways to consumers to pay and transact. Under its new owner, Beem It will be able to take full advantage of the infrastructure, cost benefits and partnerships offered by eftpos which will help it grow faster and expand the innovative services it currently provides. We believe this transaction will secure Beem It’s future as a leading digital wallet provider and we wish the company and its team the very best for the future.”

BeemIt
03-11-2020
beemit

More choice and potential savings for Australian small businesses during COVID-19 and recovery

Australia’s domestic debit card company, eftpos, today announced it has started to roll out digital payments solutions for businesses wanting more choice and potential savings in the challenging COVID environment.

eftpos is best known for helping Australian businesses and consumers with low cost and secure payment options instore and is now also available to Australian businesses that accept online card-on-file transactions from their customers.

eftpos CEO, Stephen Benton said dozens of Australian businesses, including Aussie Broadband and Cluey Learning, were already embracing eftpos card-on-file payments, with tens of thousands of transactions being processed through the service each month.

Mr Benton said almost 40 Australian banks including Suncorp, were also supporting the service, enabling their cards to be processed by eftpos for card-on-file payments.

“eftpos is synonymous with low cost debit card payments in store at retailers across Australia, and we’re excited to start making headway in the digital payment space,” Mr Benton said.

“It is early days but the service will increasingly enable more small and medium businesses to have Australia’s most popular cards – multi-network debit cards – processed by eftpos, and potentially deliver significant cost savings. These potential savings are particularly important for small businesses during COVID-19 and recovery.

“I urge small businesses that use card on file payments to talk to their digital payments providers about switching on the service.”

Card on file transactions are payments made from a card which is securely stored by the merchant or their payment system provider, for regular payments.

Some banks are supporting eftpos processing for regular payments initiated by the merchant, such as monthly subscriptions or payments initiated by the customer, such as occasional grocery orders.

Mr Benton said that if merchants were interested in accessing the new service they should contact their online payment service provider.

Aussie Broadband’s Managing Director, Mr Phillip Britt said: “We’re very excited to switch on eftpos’ digital payment solution. We believe this solution could potentially help Australian businesses reduce costs during these challenging times.”

Cluey Learning’s CFO, Mr Greg Fordred said: "As a rapidly growing online school tutoring business, Cluey Learning needed a low cost, scalable payment method. We've now moved to eftpos' digital payments which we're finding is a great solution."

Australia map
24-08-2020
australia map