There are different players in the "Payments Cycle", from the end users to the banks and even the clearing systems that they use. Each one has widely differing requirements as regards their information needs.
The older folk among us may remember a song that was popular in the mid-1960s, by Bobby Sherman titled “Happiness Is”. To quote a key line from the lyrics “happiness is different things to different people”. And this is my starting point. It is the “different things to different people” part that is so important, especially when one considers the critical issues that surround the payments industry.
Banks have long claimed the right to be the sole interlocutor in the payments world – a right that they claim on the strength that they alone legally hold the accounts of individuals from which and to which these payments are made. Traditionally because of this banks have been the sole and arbitrary determinant of what information constitutes a payment. Usually this is the bare minimum to satisfy the banks own operational requirements – originating and receiving banks, sender and receiver account numbers, the currency and amount and the briefest of reference information.
Payment information works for banks, but does it really work for any other participants in the payments chain? The answer is an emphatic NO! Different players in the payments chain need and would like to receive other payments related information. The ability to achieve real STP (Straight Through Processing) can lead to greater efficiencies in terms of operating procedures, processing times, fewer errors etc., etc. In short greater efficiency leads to reduced costs – and reduced costs spell increased profits. And this applies to customer and banks alike.
Broadly speaking there are four users of payments related information and they all would like to see different types of information that will assist in their own quest for efficiency.
The following brief description summarizes the parties from the payer to the beneficiary including all the intermediaries who have an interest (and of course need information) on a typical payment being made through an RTGS system. Against each party I have briefly indicated what information they need to know.
And this is just the basics! It should be clear that payments mean different things to different people.
Ah well … those 60s …..
“To a preacher it's a prayer, prayer, prayer,
To the Beatles it's a yeah, yeah, yeah,
To a banker lots and lots of dough,
To a racer a GTO.
Happiness is, happiness is, happiness is,
different things to different people,
That's what happiness is.”
(“Happiness Is” Bobby Sherman, 1965)
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