Digitization milestone for eftpos Payments Australia Limited

The eftpos Settlement Service (eSS) is a core function that leverages the benefits of the eftpos Hub processing service to drive increased value to Members and the Australian Payments Industry. It is also a major milestone in the digitization journey.

Problem:
eftpos needed to reduce the on boarding time for new members and decrease the processing complexity and costs for its members who are primarily banks and payment aggregators. Centralizing and automating the end of day settlement amongst the members using their Reserve Bank of Australia (RBA) Exchange Settlement Accounts (ESAs) was the business solution identified.

Issues:
While the eftpos hub and the applications comprising it are highly efficient it is very costly and time consuming to enhance them. Given the mission critical and high value of transactions that needed to be processed the system not only had to be robust, extremely secure, highly available (99.999%) but also cost effective to develop and not requiring specialized skills for ongoing development.

Solution:
After detailed analysis, design of a technology agnostic architecture, vendor interviews and proof of concept, a workflow engine based solution was identified as the appropriate approach. Infinity Process Platform (IPP) provided by SUNGARD was chosen as the platform for building the application. The choice of IPP was driven by the parent company background in delivering and maintaining mission critical infrastructure, the ease of development and IPP integration capabilities, especially with SWIFT. The solution also incorporated an embedded calculation engine developed in Java using in memory database to produce the end of day settlement figures and associated reports.

Outcome:
eSS enabled the centralized settlement of eftpos transactions processed via the eftpos Hub. eftpos determines the multi-lateral net settlement obligation for each Member, and initiates the settlement of those obligations through instructions to the Reserve Bank’s Information and Transfer System (RITS).

• Timely implementation within budget.
• eSS has eliminated around $1.25mill of annual operational costs for the member banks while reducing time for on-boarding new members from over 14 weeks to under 7 weeks.
• The application can be enhanced without the need for specialized resources.

The service is designed to deliver increased efficiencies for Members’ internal business operations, removing legacy complexities to make the process easier and less onerous, especially when managing industry change.