What Is Request to Pay?

Everything you need to know about this emerging, real-time, digital payments overlay service

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What is Request to Pay?

Request to Pay, referred to as RTP in the U.K., Request 2 Pay (R2P) in Europe, Request for Payment in the U.S. and “Collect” UPI payments in India, is an emerging real-time payments channel that promises benefits for merchants, banks, acquirers and billers. It is becoming an increasingly popular value-added service for real-time payments, with large rollouts happening in most parts of the world.

Is Request to Pay secure?

Yes, for multiple reasons. First, a Request to Pay is sent to a payer’s proxy payment address without the need to disclose the payer’s sensitive payment details. Next, the payer is in full control as to whether the payment is approved or not. And finally, the payer uses their verified bank application to accept the payment request and make the payment.

Where can I use Request to Pay?

Request to Pay services can be provided to consumers, merchants, billers and corporates. As consumers, Request to Pay is integrated into our everyday payments, such as eCommerce and mCommerce payments, bill payments, social payments, payments made at physical stores, etc. Request to Pay can also include B2B payments, where businesses can use Request to Pay to pull payments for invoices from other businesses.

Who accepts Request to Pay?

The use cases for Request to Pay are many. Billers, merchants, corporates, and other large and small businesses can use Request to Pay for a variety of reasons, including bill payments and eCommerce and mCommerce transactions.

Is Request to Pay global?

Request to Pay is known across the globe by different names:

  • Request to Pay in the U.K. and Europe
  • Request for Payment in the U.S.
  • Collect in India
  • E-mandates in parts of Asia

In Europe, EBA Clearing launched Request to Pay in November of 2020, while in the U.K., Pay.UK launched Request to Pay in June of 2020. The Clearing House is now live with Request for Payment in the U.S. Unified Payment Interface (UPI) Collect in India has been live since 2016, and Request to Pay went live in Hungary in early 2020. Most recently, PayNet, Malaysia’s immediate payments central infrastructure, launched its Request to Pay service.

Is the implementation of Request to Pay similar across all markets?

Yes, similar, but there can be different implementation models of Request to Pay. In some markets, such as India, Request to Pay is implemented on top of the real-time payment rails. In other markets, such as the U.K. and Europe, Request to Pay is an overlay scheme and is payments-rail agnostic.

We have also seen a direct model, like European PSD2 “Payer – Payee direct model,” where Request to Pay leverages open banking without a centralized Request to Pay scheme in between.

How does Request to Pay work in the U.K. and Europe?

In the U.K. and Europe, Request to Pay is a separate overlay scheme that is payments-rail agnostic, and the payer has the flexibility to choose the payment mode of choice, usually either SCT Inst or SCT. The user journey is quite simple:

  • The payee sends a Request to Pay to the payer
  • The payer (the consumer) receives the request on their mobile device, usually a banking app or third-party fintech app
  • The payer can then accept the request, decline it, pay in full or in part, or delay the payment
  • The payer pushes the payment using their preferred payment method, any time before the due date of the invoice

Additional Optional Services (AOS) are also available in the EU EBA scheme, which includes the possibility to use Alias / Proxy as Payer Account Identification, and links to external repositories for supplementary data.

How does Request to Pay work in the U.S.?

The Clearing House in the U.S. is live with the Request for Payment functionality on top of their real-time payment rails.

  • The payee sends a Request for Payment to the payer
  • The payer (the consumer) receives the request on their mobile device, usually a banking app or third-party fintech app
  • The request will include pertinent transaction details, including the amount, payment due date and other invoice details
  • The payer can either approve or reject the request
  • Once approved, payment is immediate using the underlying real-time payment rails
  • Both the payer and payee are notified

How does my bank support Request to Pay?

To support end consumers and businesses with the Request to Pay service, banks (consumer and acquiring) need to upgrade their systems to support the local scheme requirements (if available in your country). Consumer banks would need a solution to support their customers’ ability to approve or reject a Request to Pay message. Acquiring banks, and those supporting B2C and B2B business, will require systems to support the initiation of the Request to Pay message.

Does ACI support Request to Pay service?

ACI Enterprise Payments Platform provides an end-to-end Request to Pay solution to all our customer sub-segments of acquiring, consumer banks and payment networks. The solution supports standard Request to Pay processing, delivers value through additional business services and provides “final mile” connectivity through digital overlay services.

Why should acquirers offer Request to Pay?

With Request to Pay, acquiring banks can offer an alternative, digital mode of payments acceptance to the end merchants, billers and corporates that provides businesses real-time visibility of their incoming payments while lowering transaction costs, fraud and disputes. Acquirers will be able to target new customer segments while providing new payment methods to existing customers to protect their current customer base. Furthermore, Request to Pay provides merchants with improved liquidity and transaction reconciliation.

Why should consumer banks offer Request to Pay?

With Request to Pay, consumer banks are bringing a modern, frictionless payments experience into the hands of the end consumers and offering more control and flexibility over their payments. Request to Pay enables several new use cases, and consumer banks can drive revenue through interchange income (in markets that have a regulated pricing structure), government incentives (in markets where regulators and government incentivize banks to drive adoption) and alternative revenue streams arising from partnerships with fintechs, big techs and social giants. Request to Pay is also highly secure, reducing fraud and subsequently reducing costs of managing and writing off risk.

Enable Compliance and Competitive Advantage in a Real-Time Era

The rise of real-time payments offers an opportunity for banks to meet these changes with a strategic approach: payments modernization.