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The introduction of Request to Pay and how it could change bill paying for consumers

By Simon Brooks, Real Time Payments Service Line Manager, Pay.UK

As many may already be aware, the Request to Pay Framework was successfully launched on 29th May this year, despite initial worries it would be impacted by the Covid-19 pandemic. Following the launch, we are pleased to have already on-boarded a Repository Service Provider and a Technology Provider. We are also in the early stages of bringing a further three organisations on board, I think you would agree this is all very positive news given that we are at the very early stages in the life of the Request to Pay framework.

We have developed a demo video to help explain how the framework operates,  to help any future users get to grips with Request to Pay, and explain where there may be opportunities for them to join in. It features the new indicator mark for the framework. There is also a video to show how a Request to Pay App could work, you can watch it here.

To bring to life how Request to Pay could change the bill paying process for billers and consumers alike we have put together what we think will be a familiar story to most of you.

As a consumer, a utility bill arrives at your house in the post. You open it, check the amount, then put it to one side – you’re just heading out the door so will deal with it later. At some point during the next few days, you get round to a bit of life admin, take the bill out from the pile, go to the computer, log onto your online banking, input the payment details and write ‘utility bill’ in the reference and hit ‘pay’. You don’t realise that you should be putting in an 18 digit reference, which helps the utility company that sent you the bill identify your payment.

The current process has quite a few steps for you as a consumer, not to mention if you have to ‘add a new payee’ to your account which means having the sort code and account number to hand as well as security.

Wouldn’t it be great if you, the consumer, could get all your bills in one place, allowing you to see which bills you have outstanding, and being given options of when and how you can pay them. More importantly, when you do decide to pay the bill all that information the biller needs will be automatically uploaded into the payment for you.  Finally, you may have an issue with the bill that you want to discuss with the biller, no more picking up the phone and waiting in a queue; with Request to Pay you will be able to communicate directly with the biller, it will be as simple as sending them a text or an email, but all through the safe and secure messaging framework that is Request to Pay.

Let’s not forget the biller. Incorrect or wrong references means that someone will have to go through and work out which payment matches which bill, which will be time consuming.

Request to Pay will solve all of this. Instead of a paper bill, the consumer will receive a “Request” through a number of delivery channels including an app on a mobile phone, with the bill attached to the “Request”. At this point the consumer can decide to pay some or all of it there and then, clicking a few buttons to connect to your preferred payment method. At the utility company, they can see your payment come in and know immediately what bill it corresponds to because the payment has all the reference information they need to reconcile the payment.

Request to Pay will create significant opportunities to create a more convenient and more flexible way for consumers to make payments; and a more efficient way for businesses to collect them. A key challenge is how these opportunities can be harnessed through the competitive market place. How to get to a critical mass of consumers utilising the service that ensures billers see Request to Pay as a convenient way to send bills to their customers, and consumers can get all the benefits that the Request to Pay Service will bring to them.

Request to Pay is a game changer but it needs banks, Fintechs and corporates of all sizes to see its potential and get involved.

It should be noted the benefits of providing a Request to Pay front-end to consumers or businesses are varied and potentially significant, it can help create on-going customer engagement. If a provider can become the go-to interface their customers use to manage Request to Pay activity, then they will have a captive audience. Some may elect to monetise this by creating a paid-for Request to Pay service; others may deem customer engagement sufficiently valuable in itself. Retail banks, for instance, may see the provision of a Request to Pay interface to their customers as a way to differentiate their offering, and drive greater loyalty in an era of multibanking.

‘Providing’ the Request to Pay customer interface is not necessarily the same as building it from scratch. Some entities may wish to offer a Request to Pay front-end to their customers but not necessarily want to undertake the technical build. Here, there could be a further opportunity for developers to build the interface and allow other businesses to white-label it. In this case, the value is less in the customer relationship and more in the development of an interface that can be licensed for a fee.

If you are interested in finding out more about the Request to Pay Framework you can view a recording of our recent webinar here.

We have also created some factsheets to further support spreading the word of how great this proposition is and the many different sectors that will benefit from the introduction of Request to Pay, these factsheets can be found in the Publications section of the Request to Pay website.