Скачать презентацию NACHA Online Payment Initiatives Joint Payment Center Conference
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NACHA Online Payment Initiatives: Joint Payment Center Conference Rob Unger, AAP Sr. Director Network Services NACHA 703 -561 -3913, runger@nacha. org (c) NACHA
Agenda NACHA/ACH Overview n EBIDS (Electronic Billing and Information Delivery Service) n Secure Vault Payments n Exception Processing Mitigation n (c) NACHA 2
Introduction to NACHA Not for profit association n Two primary functions n ¨ Establishes operating rules for Automated Clearing House Network ¨ Trade association to promote electronic payments (c) NACHA 3
What is the ACH Network? n n “ACH” stands for Automated Clearing House. The ACH Network is an electronic banking system: ¨ Batch processing, store and forward ¨ Transactions are stored during the day and sent to the network in batches, usually in the afternoon and/or evening ¨ Transactions are not real-time or online. n The ACH Network processes both credits and debits. (c) NACHA 4
Scope of ACH Rules n n n 18, 000 Financial Institutions 6 million companies 145 million consumers 16 billion transactions in 2006 33 trillion dollars in 2006 ¨ Direct Deposit ¨ Direct Payment ¨ Corporate payments ¨ And more (c) NACHA 5
ACH Volume Growth of selected ACH transactions update Total ACH POP 2005 13, 957 2006 15, 984 Increase 14. 5% 224 356 59. 0% 1, 343 1, 807 34. 5% 2, 154 2, 839 31. 8% 319 388 21. 5% Avg $ 79 WEB Avg $ 385 ARC Avg $ 290 TEL Avg $ 403 (c) NACHA 6
Agenda NACHA/ACH Overview n EBIDS (Electronic Billing and Information Delivery Service) n Secure Vault Payments n Exception Processing Mitigation n (c) NACHA 7
EBIDS Discussion 1. 2. EBIDS Concept Processes Biller Enrollment 2. Consumer Enrollment 3. Bill Presentment 4. Bill Payment 1. 3. 4. Benefits Pilot Status (c) NACHA 8
Electronic Billing and Payment Needs n n Despite significant gains, overall EBPP adoption still low compared to entire possible volume Current state bill presentment/delivery ¨ ¨ ¨ n Unique customization requirements for bill Proprietary channels are the only option for bill delivery Greater adoption requires interoperable, secure method for bill distribution Current state bill payment Check payments still generated from online banking because banks don’t know how to send electronic payments to all billers ¨ Lack of data/incorrect data from online banking systems increases exception processing ¨ n Bill payment is a costly “free” service for banks to provide (c) NACHA 9
The EBIDS Breakthrough n n Bill delivery: The ACH is an interoperable, rules-based, secure network that can provide a ubiquitous bill delivery/payment channel to thousands of FIs and millions of businesses Bill payment: The ACH credit model is a low-risk, lowcost option that eliminates non-electronic payments and user-based exceptions from online banking when coupled with bill presentment. New revenue paradigm: EBIDS proposes a business model for banks to be compensated for enrolling consumers and presenting consumers’ bills, and provides a least cost routing option for payment. Pilot sponsored by NACHA’s Council for Electronic Billing and Payment (c) NACHA 10
Electronic Billing Information Delivery Service (EBIDS) n Consumer enrolls for ebill via Internet banking with consumer’s bank n Biller (via a bank) sends summary billing information/remittance data in an ACH addenda record with a URL to provide access to bill detail n ACH network serves as ‘switch’ and delivers summary bill information to consumer’s bank n Consumer’s bank provides billing information to consumer via Internet banking system n Consumer authorizes credit payment, transacted through normal ACH processes with remittance data (c) NACHA 11
EBIDS Summary Process Flow 1. Enrollment Consumer enrolls through CFI to receive summary bills from Billers via ACH using ENR Consumer Financial Institution (CFI) 2. Acknowledgement Billers need to acknowledge EBIDS enrollment requests. Biller confirms/rejects an enrollment using the ENR entry ACH Operator Biller Financial Institution (BFI) 1 2 3 3. Bill Presentment Biller to route the consumer’s next bill to the CFI using a zero-dollar CTX transaction, with the summary bill info embedded in an addenda record 4 Consumer 4. Bill Payment Consumers will connect to CFI system to view summary bills and authorize payment to Biller (c) NACHA Biller 12
Biller Enrollment Ø Allows for data capture, storage and retrieval of biller and bank information. Ø Supports consumer banks’ need to know which billers are participating Ø Supports consumer enrollment and delivery of electronic payments with remittance data Ø Support delivery of epayments without e-bills Ø Ensure e-payment and remittance data go to most current and correct electronic lockbox Ø A web-based application (c) NACHA 13
Biller Profile Information (c) NACHA
Consumer FIs download biller directory data via XML file, add biller to their billpay system (c) NACHA
Consumer Enrollment Automated Enrollment Entry (ENR) via the ACH 2. Consumer Financial Institution (CFI) initiates ENR for each biller and transmits entries to ACH Operator Consumer Financial Institution (CFI) 1. Consumer enrolls through CFI providing the required enrollment info Consumer ACH Operator 3. ACH Operator routes ENR to appropriate BFI Biller Financial Institution (BFI) 4. BFI delivers ENR to biller – biller enrolls consumer MAINTENANCE Consumers may deactivate their EBIDS enrollment through the same process flow through the CFI (c) NACHA Biller 16
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ENR Sample: “ 7” Addenda Record Type Code Addenda Type Code Enrollment Related Information Addend a Sequen ce Number Entry Detail Sequence Number M M R M M Contents ‘ 7’ ‘ 05’ Include characters of addenda noted below in 80 character segments in multiple addenda See Field Defs. Length 1 2 80 4 7 Position 01 -01 02 -03 04 -83 84 -87 88 -94 7 05
Enrollment Acknowledgement ENR Enrollment Confirmation 2. BFI transmits ENR to ACH Operator for delivery to CFI 3. ACH Operator routes ENR to CFI, CFI updates bill presentment data system with enrollment status Consumer Financial Institution (CFI) ACH Operator Biller Financial Institution (BFI) 1. After accepting ENR, Biller transmits acknowledgement to BFI to confirm receipt and acceptance (or rejection) 4. Consumer connects to CFI system to view enrollment status Biller Consumer (c) NACHA 23
Bill Presentment Zero-Dollar CTX Bill Presentment 2. BFI transmits CTX to ACH Operator for delivery to the CFI 3. ACH Operator routes CTX to CFI, CFI updates bill presentment data system with new bill Consumer Financial Institution (CFI) ACH Operator Biller Financial Institution (BFI) 1. After receiving ENR and enrolling consumer, Biller transmits zerodollar CTX with bill summary data embedded in an addenda record 4. Consumer logs on to CFI to view bill Biller Consumer (c) NACHA 24
Click here to see ebill (c) NACHA 25
Bill detail from Verizon site no sign-in required (c) NACHA 26
Accessing Full Bill Detail: SAML Server (Strategic Assertion Markup Language) n n Consumer clicks to “view bill” on the consumer FI site then receives bill detail from the biller site SAML is a message protocol for passing the consumer FI credential to the biller, without requiring the consumer to log-in with the biller Accomplished through the exchange of assertions and seamless to the consumer Result: a ‘single sign on’ (c) NACHA 27
CTX (Corporate Trade Exchange) for Bill Summary Sent by Biller to Consumer FI – Sample “ 7” Record CTX ADDENDA RECORD for EACH CONSUMER Record Type Code Addend a Type Code Ebill Summary Information Addend a Sequen ce Numbe r Entry Detail Sequen ce Number M M See Field Defs. M M O Contents 7 05 Include first 80 characters of data noted below Length 1 2 80 4 7 Position 01 -01 02 -03 04 -83 84 -87 88 -94 Example 7 05 478. 34
Bill Payment CIE Bill Payment 3. ACH Operator routes CIE to appropriate BFI, BFI credits Biller account 2. CFI sends CIE to biller via the ACH Operator Consumer Financial Institution (CFI) ACH Operator 1. Consumer authorizes payment to Biller after viewing summary bill on CFI system Biller Financial Institution (BFI) 4. BFI routes Biller remittance identifier data to Biller; Biller credits consumer account Biller Consumer (c) NACHA 29
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CIE (Consumer Initiated Entry) Sent by Consumer FI to Biller – Sample “ 6” Record ENTRY DETAIL RECORD (CIE) Record Type Code Receiving DFI Identification M Contents Trans action code M 6 (2) 22 Check Digit Account Number Amount Individual Name Individual Identification M M R M (3) Biller’s RTN at BFI (3) Biller RTN Check Digit (3) Biller’s Acct. # at BFI (4) $ amt. Paid by the customer; zero filled (4) Biller’s Customer Name (4) Customer’s account number at Biller Discre tionary Data Addenda Indicator Trace Number O M M Blan Always 0 (no addenda) Assigned by ODFI k Length/A lpha. Numeric 1 2 N 8 TTTTAAAA 1 N 17 A 10 N 15 A 22 A 1 N 15 N Position 01 -01 02 -03 04 -11 12 -12 13 -29 30 -39 40 -54 55 -76 77 -78 79 -79 80 -94 Example 6 22 23456787 8 123456789012 34567 000000867 3 STEPHANIE LEWIS 123456789012 0 45542779765778 8 (c) NACHA 32
Biller Benefits Meets preference for multiple channels Ø Increased adoption Ø Reduces unapplied payments Ø Guaranteed funds Ø No administrative returns Ø Accelerated posting of payment Ø Cost reduction Ø Improved customer experience Ø (c) NACHA 33
FI Benefits n n Supports online banking: lowers attrition, higher account balances, increases cross-sell, lower service costs EBIDS leverages ACH Network for enrollment, presentment, and payment ¨ Lowest cost channel and best potential reach ¨ Uses industry standards – NACHA rules ¨ Non-proprietary n n n Provides compensation to consumer’s financial institution – new revenue stream Enables a more direct working relationship between biller and banks for EBPP New revenue opportunity for bill 34 (c) NACHA delivery/remittance services
Consumer Benefits n n Privacy of information – financial account information remains with financial institution Remains in control of account and timing of payment Access to more bills, bills are consolidated at one site Access to bill detail through single sign on (c) NACHA 35
Pilot Status n EBIDS Product Design complete ¨ n n n Processes, rules, and data formats for consumer enrollment, presentment and payment Biller Directory complete SAML Server – in final testing phase Pilot revenue model complete Participant system update and integration - ongoing Target date for launching transactions: 3 rd quarter 2007 NEED MORE BILLERS! (c) NACHA 36
Agenda NACHA/ACH Overview n EBIDS (Electronic Billing and Information Delivery Service) n Secure Vault Payments n Exception Processing Mitigation n (c) NACHA 37
Market Drivers n Rapid growth of Internet commerce has led to industry challenges. n Security and privacy concerns ¨ 50% of US Internet users avoid making purchases online, afraid financial information may be stolen (Cyber. Security Alliance Research 5/06) ¨ Nearly half of consumers avoid online Bill Pay due to security concerns (com. Score Networks, cited in American Banker 4/20/06) ¨ Alternative online payments will account for 26% of e. Commerce volume by 2009 (Celent, 5/06) n Continued fraud and chargebacks ¨ 35% of online orders are flagged for manual review related to fraud detection (Cyber. Source Corp. , cited in Digital Transactions 6/13/06) ¨ 6% of good sales lost due to fraud/risk screening (Cardline 2005) ¨ Fraud is the top reason given for chargebacks on several networks (American Banker interviews with network executives, 1/17/06) (c) NACHA 38
Market Drivers Cont. n Businesses want payment options 72% of consumers surveyed say the have abandoned an online purchase 74% of consumers willing to spend $960 more per year (Javelin Strategy and Research, 7/06) − 24% of consumers report shopping less online (Visa news release, 1/06) − − n Open new markets − − n Online account opening − n Digital content – music, games, subscriptions, video Last-minute/expedited payments Bank reliance on non-bank providers – Cash. Edge, Yodlee Guaranteed & authenticated payment options for billers − − − Card issuers Mortgage and loan payments Bank-centric substitute for biller-direct (c) NACHA 39
The Private, Secure, Bank-Authenticated Payments Solution n ‘Secure Vault’ simply refers to using online banking to initiate Internet payments n Consumers keep financial information private – never disclosed to the seller n Seller receives real-time authorization of guaranteed payment (ACH Credit) n Financial Institution authenticates the buyer, reducing risk, fraud, and charge backs n Relieves seller burden to secure/protect consumer financial information (c) NACHA 40
Demos Consumer Purchases n Bill Payments n Funds Transfers n (c) NACHA 41
Key Features Bank customers keep financial information private – never disclosed to businesses n Bank leverages existing online banking platform and connections to payment networks n Bank receives interchange revenue for authenticating existing customer and guaranteeing payment n Bank is central to its customers’ transactions n (c) NACHA 42
Stakeholder Benefits – Businesses n n Real-time authorization of a guaranteed payment (ACH Credit) Sales lift – new customers, higher tickets, more purchases, less shopping cart abandonment FI Authentication - reduces risk, fraud and charge backs Eliminate need to secure/protect customers’ financial data (c) NACHA 43
Stakeholder Benefit - FIs n n n Use existing infrastructure - costs to support this channel have increased in the areas of authentication and security (FFIEC Guidance) Create new potential revenue stream - FIs generate little direct revenue from the online banking channel today Leverage customer relationships Grow the e. Commerce ‘pie’ and enable new online transactions Take a leadership role in privacy (c) NACHA 44
Stakeholder Benefits – Consumers Security and privacy – no financial information shared with the seller n Familiar user interface with online banking n More payment control and flexibility n Consumers are most comfortable sharing private financial information and account access with their Financial Institution n (c) NACHA 45
NACHA’s Online Payments Pilot n Pilot Participants: ¨ Buyer’s FI (Guaranteeing ODFI) ¨ Seller’s FI (Receiving FI) ¨ Businesses (online merchants, billers, state govt. agencies) ¨ Third Party providers (enable FI and business customers) ¨ e. Wise (pilot network provider) (c) NACHA 46
Participation Requirements n Participation Requirements: ¨ Buyer’s FI (Guaranteeing ODFI) must be FFIEC compliant for online banking ¨ Businesses must be sponsored by a Receiving FI ¨ Receiving FI warranties performance of sponsored businesses ¨ Resources necessary for integration work with e. Wise n Pilot Fees ¨ There is no registration fee to join the pilot ¨ Inter-bank and network fees will be collected ¨ Fees will vary by transaction type ¨ Fee structures have been announced (c) NACHA 47
Next Steps INTERESTED IN LEARNING MORE ABOUT THIS PAYMENT TYPE AND THE PILOT? n Check out the new Online Payments Pilot Website at paymentspilot. nacha. org n Contact George Throckmorton at NACHA: gthrockmorton@nacha. org regarding pilot participation n Contact e. Wise at pilot-info@ewisesystems. com for technical and implementation information (c) NACHA 48
Agenda NACHA/ACH Overview n EBIDS (Electronic Billing and Information Delivery Service) n Secure Vault Payments n Exception Processing Mitigation n (c) NACHA 49
Exception Processing Mitigation n Purpose: to reduce errors (and costs) and improve straight-through processing for bill payment exceptions that originate from online banking systems ¨ n Typical issues ¨ ¨ ¨ n Sponsored by NACHA’s Council for Electronic Billing and Payment Incorrect account number (front-end) Biller account number changes (back-end) Biller metrics for identifying costs Stakeholder costs = $533 million in 2006 ¨ ¨ Consumers-$25. 9 million Consumer service providers-$130. 6 million Banks/3 rd party processors-$14. 1 million Billers-$362. 7 million (c) NACHA All data from Tower. Group. All rights retained by Tower. Group. 50
Exception Processing Mitigation: What Can We Do? n n Identify best practices to minimize consumer errors (front-end) Develop benchmark biller metrics for identifying the cost of exceptions Define biller/processor processes for account number changes (back-end) Develop a communications plan for maximizing industry outreach (c) NACHA 51
Summary n n NACHA seeking to improve the payments process for billers. More information: ¨ NACHA n http: //www. nacha. org ¨ Council n for Electronic Billing and Payment http: //cebp. nacha. org ¨ Secure n home page Vault Payments http: //securevaultpayments. org (c) NACHA 52