Banks to be fined over lack of NPP service
(30 July 2019 – Australia) The governance body for the fast payments system stands ready to fine banks that fail to provide business customers with access to the real-time, data-rich system, as the Reserve Bank seeks to push tax, superannuation and payroll payments onto the new platform to increase productivity.
The board of NPP Australia agreed in June it would levy "non-compliance charges" on banks after the Reserve Bank criticised banks for not providing access to the platform quickly enough, which it described as "disappointing". The major banks spent more than $1 billion to build the system under pressure from the RBA which wants payments opened up to more providers.
NPP launched with peer-to-peer payments but the real value to the economy will come from companies sending data alongside a payment. For example, at the same time it pays staff a company could report to the Australian Taxation Office or pay super contributions. NPP Australia will publish a road map in October on its requirements for functionality and target implementation dates.
The charges range from $50,000 for small banks, to $0.5 million for large banks and these can be escalated and compound until access is provided.
The NPP's response comes after the Reserve Bank criticised a slower-than-expected rollout by banks which it said "appears to reflect the complexity of their systems and underestimation of the degree of investment needed to meet delivery time frames".
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