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Request for Payment
Faster Payments has offered a credit transfer (push payment) service since launch in 2008. The Faster Payments Service now handles over 1.4 billion such payments worth over £1 trillion a year.
Over the last year or so, a number of service users have expressed interest in services that have been variously described as “real-time direct debit”, “pull payment” or “request for payment”; all of which would, in different ways, allow an individual, business or institution to collect a payment from another with the speed and reliability of our current Faster Payment credit service.
We believe that, functionally, a fully automated pull or ‘instant direct debit’ payment will be delivered through the industry changes required to support PSD2 Payment Initiation Services in the next 2 to 3 years. Development of a bespoke pull payment capability by Faster Payments would, therefore, be unnecessary, as it would be simply duplicating this capability.
However, even with the introduction of PSD2, if consumers and businesses are to ubiquitously adopt electronic payments, then they will require much more complete, day-by-day and hour-by-hour control over the flow of payments from their accounts.
Changes in working patterns (self-employment, multiple employments, zero hours contracts) has led to increasingly unpredictable/irregular income streams for some consumers. This makes established methods of payment (Direct Debit/Standing Order) less suitable when trying to balance the irregularity of their incomes against the regularity of their bills. The same applies to those on very low incomes who today use a ‘cash-pot’ to manage income against expenditure and ‘millennials’ who have grown up using a mobile phone prepay account as their first experience of ‘money management’.
What all these consumer segments (and probably others more widely) have in common, is a need for control (of when and how much they will be debited), flexibility, transparency, accessibility and simplicity.
For the last year we have been developing and researching our insight into Payer needs around a Request for Payment service. This has been elaborated through an evolving prototype app in conjunction with a series of interviews with a range of Payers and Billers. We have worked closely with two organisations in particular to help with research into end user requirements, that will inform the final concept. The work done with these organisations has been captured in two reports into the viability of a Request For Payment service in the UK.
Request for Payment
Produced by Eclipse Experience in conjunction with Faster Payments
This report summarises the service user research conducted by Eclipse Experience and Faster Payments into the benefits to users of a Request for Payment service. This research took place between March and September 2016, via a number of interviews with both payers and billers, utilising two prototype devices to stimulate responses from the interviewees. The report provides a background into how the interviews were conducted and the findings that resulted. The report provides strong evidence that a Request for Payment Service would be of benefit to both Payers and Billers.
Economics of Request for Payment
Produced by Accenture in conjunction with Faster Payments
An analysis of the economics of Request for Payment. This looks at the economic benefits for Billers, Payers and the UK economy as a whole. Again this report supports a strong case for Request for Payment service being introduced into the UK market, something also endorsed by the PSF Strategy document published on 29th November.
We would welcome any comments/feedback in respect to these reports. If you have any comments please direct them to the following email address Development@fasterpayments.org.uk