*The views expressed in this article are solely those of the authors and should not be attributed to the European Payments Council.
The landscape of payment solutions in the retail market is undergoing transformation and Request to Pay (RTP) is gathering momentum. Last week we issued a guidance document called RTP: Specifications for a standardisation framework to support further work on an RTP scheme. To mark the occasion, we interviewed the two RTP multi-stakeholder group (MSG) co-chairs Jean-Yves Jacquelin and Pascal Spittler to reflect on the groups’ work, challenges and possible evolutions. In addition, our infographic summarises the key things you need to know about RTP.
How would you describe RTP for those unfamiliar with the topic? Was it a ‘missing piece’ in the new payment landscape?
In simple terms, RTP is a new way to request a payment initiation. In electronic payments, the RTP can be defined as the set of operating rules and technical elements that allow a payee entity (merchant, individual, etc.) to claim an amount of money to be paid by another entity (consumer, company, etc.) – i.e., the payer. The RTP includes all elements needed by the payer to initiate the payment smoothly: the amount; to whom this amount must be paid; by when; for what transaction; specific conditions, etc. In addition, in some cases the payer can be directly informed about the RTP initiation by the payee through various environments such as proximity technologies, messaging applications, specialised , etc.
Linked to an instant payments, RTP will allow the creation of a powerful new and seamless way to pay within .
Therefore the RTP can indeed be considered a ‘missing piece’ because it completes the end-to-end flow and lies between an underlying commercial transaction and the payment itself.
Could you elaborate on the creation, mandate and composition of the ?
Initially, the creation of the was related to the Multi-stakeholder Group on E-invoice Presentment and Payment (EIPP MSG), which identified RTP as the central element for EIPP eco-systems. A substantial part of the EIPP MSG work in 2018 involved updating two ISO 20022 RTP messages and making them usable for EIPP needs.
It also goes back to the observation made by the European Payments Council ( ) concerning other initiatives in the market that made use of the RTP from a broader perspective for claiming payments. It showed that the RTP could be a compelling functionality complementing the Single Euro Payments Area ( ) payment schemes for a better end-to-end payment user experience in retail, Business-to-Business (B2B) and Person-to-Person ( ) commerce.
The initiative was finally set up by the board following an invitation extended by the Euro Retail Payments Board ( ) at its meeting of 28 November 2018.
The group was composed of 25 members including representatives of members, users, technical solution providers, processors and observers.
What are the key findings and recommendations of the ?
First, the group concluded that the RTP functionality should support the end-to-end processes applied in a large set of use cases – and especially those based on credit transfer payments. Second, the use of ISO 20022 standard for RTP-related messages could ensure a smooth articulation with the payment schemes and maintain the RTP within the broad scope of a global ISO standard. Regarding interoperability, various types of entities could operate RTP eco-systems, whereas payment initiation always involves payment service providers ( ).
With the goal of setting up an operational RTP environment, the suggested the creation of an RTP scheme separate from the payment schemes. Work on the scheme will be undertaken by the with the regular involvement of all interested parties in a multi-stakeholder format. In addition, there will be an assessment of whether there is a need to create supporting change requests as part of the Credit Transfer ( ) and Instant Credit Transfer ( ) 2020 change-management cycle.
Can you describe the RTP’s use cases?
One of the first
tasks was to analyse and identify potential use cases. We identified a wide variety potentially supported by the RTP. Some examples:
• Retail commerce transaction at physical or online Point of Interaction (POI) followed by an instant payment,
• Proximity
transaction followed by a payment initiation,
• Business-to-Customer (B2C) and B2B e-invoicing.
Some of these examples also lie within the scope of several initiatives currently undertaken by the or the with which coordination is ensured.
How would you describe the link between RTP and payment schemes (and especially )?
Initially, as we mentioned earlier, the RTP was a ‘missing piece’ in the payments’ flow. It is also an enabler for payments. Moreover, from the perspective of the scheme, the RTP opens new implementing solutions covering a broad list of use cases.
Additionally, ISO 20022 – the proposed standard for RTP – is also the standard of the current payment schemes. This would facilitate implementation and harmonisation of the RTP across .
How do you see the future evolution of the RTP?
Generally speaking, the RTP, together with the Schemes, has the potential to be a game-changer due to its various benefits.
Following the launch of the RTP scheme covering basic features in the inter-provider space based on a four-corner model (payee and payer with their respective providers), a potential next step could involve the development of enhanced features and guidelines for harmonisation of the RTP at the POI.
Infographic: How the Request-to-Pay works (December 2019)
(Click to enlarge and download)
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Pascal Spittler
Pascal is Process Development Leader at IKEA INGKA Group. He is currently acting as co-chair of the RTP and MSG MSCT working groups as well as co-chair of the ECSG Volume Sub-group.
Jean-Yves Jacquelin
Jean Yves Jacquelin is in Product Management & Development of Erste Bank Austria as Senior Expert Payments for Erste Bank, Austrian Savings Banks, Erste Group Bank and Group countries. He is a chairman of the Scheme Evolution & Maintenance (SEM) working group having the responsibility for the four Rulebooks and Scheme Management Board member.