The Year Ahead by Andy White

Welcome to 2020. We all hope it brings relief from the bushfires that have affected so many Australians.

In payments, 2020 shapes to be an exciting year; at the heart of it is our vision of convenient and secure payments for all.

Just before the end of last year, coinciding with International Day of People with Disability on 3 December, we released Guidelines for Accessibility in PIN Entry on Touchscreen Terminals. I am immensely proud of our work in this area, and look forward to us building on this initial work on accessibility in 2020. We also released card fraud statistics in mid-December showing a decline in the rate of fraud on Australian cards for the first time since reporting became public in 2006. Both these developments are covered in this issue.

Also at the end of the year, our Summit on 10 December brought together more than 300 people from across the payments community sparking lively debate and discussion. In his keynote address, the RBA Governor, Philip Lowe, included a clear ask for further industry work on four topics: innovation, digital identity, resilience, and cheques. To this end, in 2020, we will build on work that I have covered in previous Payments Monitors:

1. To support innovation, we will publish the conclusions from our industry consultation on the future state of Australia’s payment systems and the steps and the enhancements necessary for that future state to be realised. We will also, pending an RBA conclusions paper due at the end of this quarter, look forward to leading the industry work to migrate the messaging that underpins the high value clearing system to ISO 20022. This will migrate Australia’s high value payments to a rich data format, and comes with the strategic opportunity to harmonise messaging formats across domestic high value payments, cross-border payments and real-time payments (NPP).
    
2. In 2020, we can also look forward to digital identity services coming to life under the Australian Payments Council’s TrustID framework which is now being managed by AusPayNet. We are building out accreditation criteria under the framework and have already been approached by seven digital identity service providers for accreditation.
    
3. We will also focus on the resiliency of our payment systems, by: developing a standard set of operational performance statistics, in work that will involve our members, the RBA and APRA; and reviewing the technology underpinning the COIN network.
    
4. And we will continue to manage the consumer-led decline in cheques, to ensure that before cheques cease to be a viable option for consumers, any remaining cheque users have effective digital alternatives.

Elsewhere, we expect to see more evidence of the effectiveness of the industry card-not-present (CNP) fraud mitigation framework which went live on 1 July 2019. Early data shows merchants are dealing with CNP fraud where it affects them; this is of course really encouraging in dealing with the primary category of fraud experienced in Australia.

We will also contribute to the policy agenda through, for example, ASIC’s consultation on the ePayments Code and the RBA’s review of retail payments regulation.

More broadly, we can look forward to the introduction of the Consumer Data Right (CDR), which will give consumers greater control over their data. This introduction has been sensibly delayed until July this year to ensure that, in ACCC Commissioner Sarah Court’s words, “the system is resilient, user friendly and properly tested”. Given that the CDR is much broader than open banking, with work on the energy sector already started, and work on the telecommunications sector planned, it is critical that the IT infrastructure and regulatory settings are appropriate and well tested.

So 2020 will be both exciting and busy. On behalf of AusPayNet I wish you all the best for the coming year.

Special Feature: Overview of our 2019 AusPayNet Summit

We were delighted at the success of our annual Summit on 10 December 2019 bringing together more than 300 local and international experts. Opened by AusPayNet Chair, Rob Craig, the theme of the day was Payments – the key to the best customer outcomes. The sell-out event saw insightful discussion and debate across several topics; the convergence of payments, digital transformation, AI and cybersecurity, innovation, stakeholder collaboration and customer experience. Read the full report of the Summit here.
 

Accessibility Guidelines

Coinciding with International Day of People with Disability, on 3 December 2019, we released Guidelines for Accessibility in PIN Entry on Touchscreen Terminals. These guidelines are designed to make it easier for people living with a vision and/or motor impairments to make payments on point-of-sale (POS) touchscreens. This is a world first in addressing access to POS touchscreen technology. The guidelines also mark a key step in efforts to ensure innovations in payments technology are accessible to the widest population. Access the Guidelines here.

The Future State of Australia's Payment Systems

In November 2019, we undertook an industry consultation to gather further input to build a consensus view on what the payments system might look like in the next 5-10 years. This consultation is complemented by the Australian Payments Council’s (APC) recent consultation to inform its Strategic Agenda and the RBA/APC consultation on migration of RTGS to ISO 20022. These contributions will form a conclusions paper for publication by the end of March 2020. For more information, click here.

Card Fraud Slightly Down

On 18 December 2019, we released card fraud statistics covering July 2018 to June 2019. The latest figures show that spending on cards is up, and card fraud is declining. In the last 12 months to 30 June 2019 (FY19), spending on Australian cards grew by 4.2% to $799 billion. Against this, card fraud dropped by 6.9% to $527.8 million. With this overall total:

• counterfeit/ skimming fraud fell 19.2% to $18.6 million
• lost and stolen fraud fell 16.1% to $43.0 million
• card-not-present (CNP) dropped 5.0% to $455.5 million

See the Media Release for more detail.

TrustID Framework

In the first half of 2020, AusPayNet is working with stakeholders to establish the TrustID accreditation process. With a number of solution providers already expressing interest in becoming accredited, this important milestone will enable the delivery of the first pilot services under TrustID.

With the growing preference for online service delivery, consumers and service providers - from retailers & banks to energy & telecommunications providers - need better ways of establishing trust.

The TrustID framework improves the security, privacy and convenience of accessing online services. Current approaches to identifying and authenticating individuals are fragmented and siloed, which has resulted in the proliferation of identity credentials and passwords. This proliferation has given rise to security vulnerabilities and created significant inconvenience and inefficiencies, which undermine the effective development of the digital economy.

The TrustID framework is not a solution in and of itself; it presents a series of rules and guidelines for organisations to adhere to in their design and build of products and services. Under the TrustID framework, products and services are interoperable, providing a competitive marketplace that offers consumers choice and convenience, whilst reducing the requirement to share personally identifiable information.

If you are interested in providing services or want to understand how TrustID could benefit your organisation, click here to find out more.