BECS Transition Updates
February 2025
Pillar 1: Collaborate with the industry
AusPayNet is collaborating with industry participants and regulators on their initiatives to facilitate the migration away from the BECS Framework. An update on industry initiatives is provided below:
| # | Initiative | Update |
|---|---|---|
| 1 | AP+’s Move to NPP Program | AP+ continues to make significant progress on The Move to NPP Program. For the latest updates on this program, Click here |
| 2 | Treasury’s BECS Transition Consultation with End-Users & Financial Institutions | Treasury has received a number of submissions to their targeted consultations with both select end-users of BECS and financial institutions that are directly involved in the BECS ecosystem. AusPayNet provided a response to the consultation with financial institutions. Treasury is expected to share the outcomes of the consultations by June/July 2025. |
| 3 | RBA’s BECS Transition Risk Assessment | Given the importance of BECS to the Australian payments system, the RBA has undertaken a risk assessment of the intended decommissioning of BECS. The findings and recommendations of the risk assessment will be reported to the RBA’s Payments System Board in March 2025. In September 2024, the RBA conducted a webinar to provide an update on the risk assessment. In December 2024, Brad Jones, Assistant Governor (Financial System), provided a further update on the risk assessment in his speech on The Future of the Payments System at the AusPayNet Summit which can be found here. AusPayNet is working closely with the RBA on this risk assessment and has confirmed its position that the BECS Framework’s target-end date of June 2030 remains conditional on industry readiness, and on ensuring that the risks identified by the RBA are properly addressed. |
| 4 | RBA’s A2A Payment Pricing Study | AusPayNet participated in the RBA’s A2A Payment Pricing Study which concluded in September 2024. The principal objective of the study was to increase the RBA’s understanding of end-user pricing and intermediary and wholesale costs for A2A payments, which is an important consideration in the transition away from the BECS Framework. The RBA intends to use the initial data collection (for the July-September 2024 quarter) for internal analysis and to share its findings with the Payments System Board in 2025. The RBA has decided that the timing of the next collection will be the second half of 2025. The reporting frequency for the quantitative data will be on a financial year basis, with the first year’s data to be collected for the period 1 July 2024 to 30 June 2025. The RBA may consider publishing some of this aggregated data externally in the future. Given the concerns raised by some stakeholders about publication, the RBA will take a considered approach to external publication of account-to-account pricing data. |
| 5 | RBA Review of Fast Settlement Service (FSS) Cost Recovery | The RBA released an Information Paper to members of the FSS in 2024 for their feedback. The RBA intends to distribute a paper to these members in early 2025 to share the key themes of the feedback received and the RBA’s response. |
In addition to the above, AusPayNet is working directly with BECS Members on monitoring the industry’s progress on transitioning BECS use cases off the BECS Framework. In December 2024, AusPayNet produced the first Industry Readiness Report, based on the BECS Transition Member Information Request (Survey), which was sent to all BECS Members and achieved a response rate of 70% (100% for 16 Tier 1 Members and 63% for 72 Tier 2 Members). Additional information was incorporated from BECS Membership data and BECS PSMS data for the twelve months ended August 2024.
The key findings and insights from the Industry Readiness report for December 2024 are as follows:
- Viability of BECS Alternatives: Members are of the view that modern alternatives’ capability for direct debit and bulk is not yet proven at scale and are only somewhat confident in their reliability for direct debit and bulk at this stage.
- Member Readiness to Transition: Members have higher confidence in migrating single push payments to modern alternatives by June 2030 and lower confidence in migrating direct debit and bulk payments by that date.
- End-User Adoption: Cost of change and run costs of modern alternatives were the most frequently identified ‘adoption blocker’.
- BECS Membership and Volume Changes: BECS volumes for the twelve months ended August 2024 were flat year-on-year, pointing to the increase in retail single push volume occurring over modern alternatives.
The Industry Readiness Report will be produced every six months, with the next one planned for June 2025.
Pillar 2: Coordinate the migration
AusPayNet recognises that a successful decommissioning of BECS will benefit from coordination between industry participants (including those that may be considered competitors). The AusPayNet Board, at its December 2024 meeting, approved a plan to proceed with an application for ACCC authorisation that proposes to cover the following conduct:
- A series of Roundtables, hosted and facilitated by AusPayNet with representation from Treasury, the RBA and AP+, on developing a common position for the future of A2A payments rails in Australia. Other payment system operators who may be interested in providing modern alternatives to BECS may also be invited to provide input to these Roundtables.
- A series of BECS Member workshops on the future of BECS and A2A payments rails to prepare for and represent BECS Member perspectives at the Roundtables. A cross-section of Tier 1 and Tier 2 BECS Members will be invited to these workshops.
Subject to ACCC authorisation, AusPayNet is targeting Q2 2025 to commence the BECS Member workshops and Q3 2025 to commence the Roundtables.
Pillar 3: Control the future of the framework
While the BECS Framework has a target end-date of June 2030, this remains conditional on industry readiness (including viability of BECS alternatives, member readiness to transition, and end-user adoption), and on ensuring that the risks identified by the RBA are properly addressed. At this stage, the conditional target end-date of June 2030 remains unchanged. The conditional target end-date has demonstrably driven greater industry focus and activity on the future of A2A payments rails in Australia over the last 12 months, and we believe will continue to do so in 2025. The conditional target end-date will be reviewed in June 2025 and December 2025, taking into consideration the progress and outcomes of all the initiatives highlighted in this communication.
The next update on the BECS Transition Program will be published in March 2025.
