CBA is the first of the big four banks to offer the PayTo service as an alternative digital direct debit payment option.
The bank said its customers can now access the service from their accounts.
Developed by New Payments Platform Australia (NPPA) and the finance sector, PayTo enables eligible retail and business customers to manage and control payments.
It also allows businesses to set up a ‘PayTo Agreement’ listing transaction details with customers, who can then authorise the agreement for a more secure payment option via their digital banking platforms.
The bank initially launched the functionality over the weekend to CBA retail and business customers with digital banking access.
CBA said the PayTo payer capability will offer its customers more control over payments such as regular bills, subscriptions and one-off payments plus also reducing fraud.
It also completed a PayTo business trial with CBA-backed fintech Paypa Plane, between Telstra and the not-for-profit The Shepherd Centre, enabling both parties to initiate specific transactions.
Under the trial, Telstra used PayTo to create a ‘payment agreement’ which allowed a customer to make a bill payment, while The Shepherd Centre created an agreement to permit a donor to make a donation.
“The trial transactions we have undertaken with two of our business customers are proof of the benefits that could be on offer to the broader business community,” CBA executive general manager payments Ethan Teas said.
“We look forward to working with our partners to make PayTo a force for positive change in the months and years ahead.”
The bank intends to extend its PayTo business trial to further selected CBA business customers and expects the service to be an alternative to other direct debit measures and online payments.
PayTo’s wider Australian rollout
On Monday, customer-owned Great Southern Bank become the first bank to launch PayTo, providing its customers access to the real-time alternative to traditional direct debits.
Both CBA and Great Southern Bank were reported by iTnews in June to be among the first adopters of the new payments service.
iTnews understands Westpac will begin its rollout in 2023.
ANZ is expected to implement the capability around April next year as well, while Macquarie will “notify clients once PayTo is available for them.”
Meanwhile, Bendigo Bank told iTnews it has started a “staged rollout to customers and look forward to providing all of our customers with access to PayTo soon”.
An NPPA spokesperson told iTnews the “PayTo rollout continues as individual organisations complete their respective implementations and live proofing.
Other financial institutions expected to enable payer customer accounts in coming months include BankWest and People’s Choice Credit Union (PCCU).
“The majority of NPP reachable accounts are expected to be enabled for PayTo by mid-2023,” NPPA’s spokesperson said.
The NPP Australia spokesperson added this past August saw “the first ‘in-market’ PayTo payment with the Reserve Bank of Australia using Hello Clever’s payment platform to make a purchase”.