PayID is a payment method that replicates the speed of cash and is available in the internet or mobile banking of more than 90 financial institutions.
When it launched two years ago, as capability offered by the New Payments Platform, PayID was predominantly marketed as a simple and instant way for friends and family to pay money into your account, without having to remember and share your BSB and account number.
But now, a growing number of small businesses are turning to PayID during the COVID-19 crisis as a simple and cost-effective way to assist cashflow and enable contactless payments.
There are now more than 4.6 million PayIDs registered in Australia, and this number has grown by nearly 20 per cent since the beginning of the year.
You can create a PayID in the internet or mobile banking of a participating financial institution, using a simple identifier like your business name, or other information that belongs to you, such as a phone number or email address.
As well as replicating the speed of cash, PayID is helpful for customers or businesses wishing to avoid physically handling money, because payments are made by the paying customer within their mobile banking app on their own device.
In recent weeks, we’ve seen an increase in small businesses promoting PayID on social media as an alternative to cash, particularly restaurants and cafes, hairdressers, services like mobile dog washing and charities, who need to pivot quickly to meet the challenges of COVID-19.
One such business is the Mandarin Palace in Burnie Tasmania who was forced to change overnight from an eat-in restaurant to fulfilling takeaway and delivery orders only. The owner, Rita Wong, needed to find a fast and simple way to enable cashless payments, so she created a PayID linked to her business account.
Now, when people ring or send a Facebook message with an order, she gives them her PayID and asks customers to pay it within their mobile banking app. When Rita gets a notification from her banking app that the money has gone into her account, she can be 100% confident she can deliver the order.
For another business owner, Melanie Cox, who runs the furniture shop Beach Boheme in Coffs Harbour NSW, the instant nature of PayID payments means she can access funds quickly to reinvest in more stock.
PayID also helps to reduce mistaken payments and mitigate the risk of fraud and scams because unlike standard bank transfers, the name you have chosen to be associated with your PayID will be shown to the paying customer before they hit send on the payment.
How to receive instant, contactless payments with PayID:
- Create a PayID with your financial institution (most offer PayID registration via their internet or mobile banking apps).
- Give your customers your PayID at the point of sale.
- Your customer logs into their internet or mobile banking and transfers the agreed amount by selecting the PayID option instead of BSB and account number.
- Your customer will be shown the name associated with your PayID and asked to confirm they would like the payment to proceed.
- Once your customer confirms the payment it should arrive in your account in just under a minute.
- Hit refresh to see the amount enter your account instantly – some banking apps will also notify a payment has been made.
Adrian Lovney, CEO, NPP Australia