Australia’s recently launched real-time instant payment platform–New Payments Platform (NPP)– will open up new opportunities for fintech startups to develop solutions utilizing the NPP network, says leading data and analytics company GlobalData.
While there may be many payment solutions that can work with the NPP platform, one payment system that would have a great potential in the Australian market would be a QR based payment acceptance. From a cost and technical perspective, a QR based solution will be the most efficient solution to implement, with particular advantages for margin conscious fintechs.
According to GlobalData’s Smart Money Analytics, a database that tracks funding in the fintech space by the world’s top venture capital and private equity firms, payments have consistently ranked among the top three sectors for investment.
The NPP, with its cutting edge functionality should spur interest among the payment fintechs, as well as others that need to move money around domestically to look for opportunities and use cases that utilize the NPP network.
Arnie Cho, Payments Analyst at GlobalData, explains: “QR based payment is not entirely new to the Australian market. BPAY, the electronic bill payment system in the market introduced a QR system back in 2013. The QR system was not mature at the time and it never gained traction at the consumer level.”
“However, with the China popularizing the QR system several markets have followed suit and even markets that typically shy away from QR and embrace the NFC standard are starting to take note on the advantage of QR and how it can fill the last few gaps path towards entirely cashless payments.”
NETS, Singapore’s national debit network for example has integrated QR into its Near Field Communication (NFC)-based contactless payment acceptance. The initiative was also a move by the government to drive the country towards a more cashless society.
While mainstream merchants accept payment cards over the NFC based system, there is however still a segment of merchants that couldn’t justify the cost of accepting payment via NFC, think the terminals required to accept ApplyPay or contactless payment cards, hence the implementation of QR in a market that already is found of paying by plastic.
Australia is similarly happy to use cards but struggles like Singapore with a segment of merchants that have yet to take up electronic payment acceptance. Another key barrier has been is also cost. With QR acceptance, the cost can be greatly reduced and implementation can also be done very swiftly.
Cho concludes: “It will also benefit mobile merchants who don’t want to lug around a POS terminal but are glued at the hip to their mobile, giving them a convenient payment option and a QR-based solution built using the functionality of the NPP would also have the potential to overtake the mobile POS acceptance. Therefore, with the NPP now in place, it is looking more convincing that there is room for a QR based payment solution in the Australian market.”
Analysts available for comment. Please contact the GlobalData Press Office:
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