John Broxis, Managing Director at Open Banking Europe has written a useful blog called “Scheming about Open Banking Schemes”.
John’s article covers a wide range of topics including: What do we mean by a scheme, SEPA API Access, European Payments Initiative, PSD2 and Open Banking / Finance however, John’s views regarding SEPA Request to Pay that are of particular interest.
You’ll find John’s full blog on the Open Banking Europe website: Scheming about Open Banking Schemes.
SEPA Request to Pay
SEPA Request to Pay is a scheme created by the European Payments Council (EPC) to “allow a Payee (Creditor) to request the initiation of a payment from a Payer in a wide range of physical or online use cases”.
The scheme stresses the benefits of end-to-end reconciliation, historically a headache for corporates and merchants when using ACH payments. The EPC also stress interoperability, reachability and a standardised set of responses for a Request to Pay message “Accept Now, Accept Later, Pay Now, Pay Later”.
The work is well advanced. A rulebook has been created and written, and preparations are being made to launch the scheme as soon as the ‘RTP Trust and Security Framework’ is finished in June 2021.
There were two drivers around the creation of this scheme. The e-invoicing community saw the need to standardise the payment request, while the ECB and others were pushing hard for a mechanism to provide real-time information wrapper for European Instant Payments. There were also concerns about the proliferation of successful but national solutions like Payconiq in Belgium.
The result is something that looks like it should be a PSD2 Payment Initiation Service (PIS), but everybody involved is very clear it is NOT a payment, nor a payment initiation (both of which have regulatory connotations). It is, they say, simply a request for payment. Furthermore, the SEPA Request to Pay scheme is not itself a customer-facing scheme. It is an industry scheme on which other players can build customer-facing schemes.
This is a similar approach to the UK which also launched a Request to Pay scheme last year.
This is subtle stuff, but similar methods have been used very successfully with the various Online Banking electronic Payment (OBeP) schemes including iDEAL in the Netherlands, MyBank in Italy, EPS in Austria, and Giropay in Germany. Although the EPC would/could argue that as Request to Pay can be used in face-to-face situations or other non-real-time cases it has a wider application than the OBeP scheme which tends to be online only.
For those who enjoy terminology, SEPA RTP is not the same thing as the UK Request to Pay which went live in May 2020. EBA Clearing’s Request to Pay (R2P) platform is built to support SEPA RTP.
And finally, do not talk to Americans about RTP in this context as they will instead understand “Real-Time Payment”.
Source: Scheming about Open Banking Schemes.