How PayTo Will Put the Squeeze on Fraud

PayTo’s baked-in instant account verification and payment notifications are set to drastically reduce fraudulent behaviour.

PayTo is a new digital way for merchants to initiate pre-authorised payments from customer bank accounts in real time. Developed by the New Payments Platform Australia [NPPA], PayTo is scheduled to switch on in mid-2022.

It’s sometimes simply described as next-generation Direct Debit, but with a huge range of use cases from e-commerce to digital wallets, subscriptions and even one-off purchases, PayTo is much more than that. PayTo will redefine account-to-account payments through innovation and improved experiences for both merchants and their customers.

But PayTo’s appeal is about more than just convenience. Significantly, PayTo’s baked-in instant account verification and payment notifications will massively reduce the kind of fraudulent and unauthorised payments that have beleaguered traditional direct debit since its inception.

PayTo is built on a foundation of trust and authority that comes from a pre-authorised and validated digital agreement between merchant and payer. The agreement is created by the merchant, and then authorised within the payer’s regular, secure internet or mobile banking app. This two-step creation-and-authorisation process confirms:

  • The identity of the payer.
  • That the bank account belongs to that payer.
  • The payment terms agreed between the payer and the merchant.
PayTo is built on a foundation of trust and authority that comes from a pre-authorised and validated digital agreement between merchant and payer.

You can see the process play out in the animation below:

For merchants, this heightened level of real-time customer identity and account verification will remove the uncertainty and complexity of collecting payments from bank accounts.

Not only that, merchants will love PayTo’s rich data sets that enable enhanced, real-time payment reconciliation at any time, all the time. Plus, there’s centralised, secure storage of PayTo agreements which are readily accessible if required for dispute resolution.

The NPP’s infrastructure has already given merchants the ability to receive funds in real time, pay out in real time, and–with PayTo–they will be able to pull funds directly from pre-authorised customer bank accounts in real time. 

There’s a lot to like about PayTo. Like, real-time funds availability checks at the moment of each payment, real-time notifications at key stages of a payment lifecycle, and notifications of any changes that are made to the PayTo agreement by the consumer. We’ll publish more about these aspects and more in upcoming articles.

PayTo is scalable, smart, secure and will fundamentally change the way merchants connect with their customers. 

Why is that important? 

The moment of payment is all about trust. It’s the ultimate opportunity for merchants and customers to cement their relationship, to create something great and enduring, something that connects them intimately. It’s not just ‘doing business’–it’s a critical moment between two parties.

Carolyn Breeze, Zepto CCO

Our Solutions team has been developing Zepto’s PayTo offering for months, consulting with merchant clients and consumers alike to ensure we deliver the ultimate PayTo solution. Porting existing direct debits to PayTo will be a breeze, so we encourage you to start your PayTo journey with Zepto now to ensure you’re ready for every bit of innovation coming down the PayTo pipe.

Integrate with Zepto now, and you’ll be PayTo-ready without any additional dev work required. You’ll transform your customer experience, and you’ll enjoy a freer, faster flow of funds.

Talk to one of our payments experts to learn more.

Learn more
Next Up