Session 127- Promotion of Flex cube Oracle "FLEXCUBE" Payments Faster Payments User Guide

Faster or Immediate Payments schemes are now being implemented by countries across the globe to enable banks in meeting customer demands for immediate transfer of funds from one account to another across banks, with certainty, convenience and at a low cost. Mexico’s SPEI, United Kingdom’s Faster Payments, India’s IMPS, Singapore’s FAST (G3) payments, Sweden’s Immediate Payments Scheme (BiR), and Australia NPP (New Payments Platform), among others, have led the way in building real time payments schemes and infrastructure.

Faster Payments module is a high performance system that supports stringent SLA of a typical Faster Payments scheme.

It is also highly scalable to increasing transaction volumes and provides very high availability.

High-lights of Faster Payments

• Manual Payment Initiation
• Receipt of individual payment requests from bank channels via ReST services and J-SON over JMS
• Business validation
• External Credit Approval Check for Outward payments
• External Account Validation for Inward payments
• Accounting
• ISO 20022 pacs.008 Message generation
• Processing response of outgoing payment from Clearing infrastructure in ISO20022 pacs.002 message format
• Receiving incoming payment in ISO20022 pacs.008 message format
• Generation of Real-time Response (pacs.002 message) of Incoming payment within stringent SLA
• Notification to Originating Customers within overall processing SLA
• Immediate Notification to Beneficiary Customer on Credit
• Sending payment details to external Sanctions systems

Given below is a end-to-end business process flow for Faster Payments in UK as an example of Faster Payments flow in general. Different countries mentioned above have a variation of the below process flow.

1. Customer A having an account with Bank A wants to transfer money to Customer B having account with Bank B
2. Customer A instructs his bank, Bank A, through mobile phone, online channel or phone banking to pay ￡1,000 today to Customer B. In addition to the amount, Customer A also provides Customer B’s bank code and account number in the payment instruction.
3. Bank A carries out its normal checks to verify that A is a genuine customer using authentication mechanisms.
4. Before Bank A allows the payment to be made, it will check that Customer A’s account has sufficient funds and that the request to make a payment is genuine. In certain cases, the bank may need to hold the payment to undertake further fraud protection checks.
5. Bank A submits the transaction through the Faster Payments Service. From this stage onwards, the transaction cannot be cancelled.
6. The Faster Payments Service sends the payment instruction to Bank B (Receiving bank) after checking that all the relevant details are included and the instruction is properly formatted, and then debits the sending bank’ shadow account in its system.
7. Once Bank B has received the transaction, it checks that the account number is valid (Note: It does not verify that the account name and account number match).
8. Bank B then sends a message back to the Faster Payments Service confirming that it has accepted (or rejected) the payment.
9. The Faster Payments Service credits the Receiving bank’s shadow account with the funds and sends a message to the Sending bank to let them know that the payment has been made successfully.
10. Bank A marks the transaction as complete. Each sending bank will decide how this confirmation will be made available to its own customer. In all cases, once the payment has been made, a confirmation message will always be sent between banks. Bank A confirms the fate of the payment to Customer A.
11. The Receiving bank will credit Customer B’s account with the ￡1,000 sent by Customer A. Where Customer B’s account is with a Faster Payment Participant Bank, he should generally be able to see the credit on his account within seconds and also be able to access the funds. If Mike’s account is with a non-participant of the Scheme, then it may take longer for funds to be shown on his account.
12. Faster Payment Service sends Net Settlement positions to Bank of England (Central bank) at settlement cut-over time.
13. Bank of England sends Settlement reports to the Sending and Receiving Banks.

Reference - https://docs.oracle.com/cd/E49819_01/html/Faster_Payments/Faster_Payments.htm