Internet Direct Debit Solution to Pay for On-Line Purchases

Two local payment operators have come together to mark a significant event of collaboration, paving the way for another cashes payment system. Consumers and merchants stand to benefit from the country’s first ever-common internet direct debit solution, which is to be launched at the end of the year. It is a result of a Memorandum of Understanding (MOU) signed between two internet payment switches in Singapore, namely, BCS Information Systems Private Limited (BCSIS) and Network for Electronic Transfers (Singapore) Pte Ltd (NETS). BCSIS is a subsidiary of a local bank and a premier provider of payment, clearing and settlement solutions whilst NETS, founded in 1985, provides a comprehensive range of electronic payment services in Singapore. The initiative is facilitated by the Infocomm Development Authority of Singapore (IDA) and the Monetary Authority of Singapore (MAS).

Under the MOU signed on 13 March 2002, BCSIS and NETS intend to interconnect their respective payment switches. This will enable merchants to link to the BCSIS or NETS payment switch to reach the customers of any of the participating banks connected to the two payment operators. The merchants will have an additional channel to collect payments for goods and services supplied online, not to mention a wider base of customers. To the online shoppers, this collaboration offers an alternative mode of payment apart from credit cards and also offers a wider choice in the selection of online merchants. Currently, 5 banks are connected to both the switches and it is expected that more banks will follow suit thereby reaping the economies of scale in the shared costs of the infrastructure.

According to a report by the International Data Corp, credit cards and cash-on-delivery are still the most commonly accepted modes of payment for online transactions. This development is indeed a milestone in realising Singapore’s goal of becoming a cashless society.