30 June 2021
How can we successfully implement Request to Pay?
On the second day of EBAday 2021, Kevin Brown, Independent Non-Executive Director and Advisor at Payment Industry Insights, moderated a discussion panel on the first steps with Request to Pay (RtP). In this session, he was joined by five international experts in this field of expertise and together they discussed the status of RtP, the role of regulators and the relationship between instant payment and RtP.
Added value of RtP
Brown kicked off the session with a poll on where the audience stands regarding RtP. The result of the poll was quite interesting as 52 per cent of the respondents was still considering RtP services for their customers, while only 8 per cent already had RtP propositions for customers in production.
Hubertus von Poser, Member of the Managing Board at PPI AG, recognised the outcome of this poll, but was still a bit surprised: “When the SEPA schemes were introduced a couple of years ago, we had a lot of projects going on, but no business case as people did not see the added value. Now it is the complete opposite: there is demand and a business case, but we need more projects for introducing RtP on the bank site.”
Successful use cases
Currently, there are already many use cases in place regarding RtP and they can be found in numerous areas. RtP can provide solutions from direct debit through to point of sale transactions. Brown asked the other experts what the winning propositions will be in this first phase. Xavier Herrero, Manager Operational Fora/Development of Banking Services at CaixaBank: “I think the real winners will clearly be the B2B and B2C markets, because the ecommerce sector and POS are already using RtP. In addition, RtP will be able to interoperate between different systems within Europe, enabling consumers to pay in another country the same way as they do at home.”
Russ Waterhouse, Executive Vice President at The Clearing House, added that largebillers, such as utility and phone companies, form the first use case regarding RtP in the United States: “The vast majority of US consumers go to billing sites and experience a lot of friction. So, this is an opportunity to aggregate this back to the banking channel.”
Standardisation is key
The discussion continued with the concern about whether the interoperability or reach of the RtP scheme will be sufficient. Will the industry sort this out or is there a role for regulators? Mark Lohweber, CEO of CoCoNet, states that this is a banking thing and that it is quite difficult for the corporate side to do something about this. In other words, the banking industry has to come up with an infrastructure for this. “In addition, the regulator must introduce an overall standardisation for the European market. Otherwise, every country will come up with its own standards, which will negatively affect the interoperability.”
Subsequently, the experts zoomed in on the relationship between RtP and instant payments. Herrero started out with saying that RtP is actually the missing link to give proper access to instant payments. Following that, Von Poser added that he believes that European regulators will make instant payments mandatory very soon.
Can RtP exist without instant payments?
The session ended with an interesting discussion on whether instant payments are essential for RtP to become a success. Lohweber started it off by stating that this is not the case, as there are several use cases in which RtP works without instant payments. The other experts did not totally agree with this statement, as they believe that instant payment is at least desirable for RtP. However, in order to be successful in POS and direct delivery, instant payment is definitely necessary. Petra Plompen, Senior Manager at EBA Clearing concluded: “The European Payments Initiative is focused on developing a European payment solution that is based on instant payment. Actually, instant payment forms the core of EPI and RtP is an important building block to come to a European payment solution.”