Payments Council to explore prospects for providing more information with payments

Payments Council to explore prospects for providing more information with payments

The UK's Payments Council has committed to explore options for incorporating richer data sets alongside business and consumer electronic payment transactions.

The Payments Council says it is in discussion with a number of government departments to explore feasibility including: the Department for Work and Pensions (DWP); HM Revenue & Customs (HMRC); and the Department of Business, Innovation and Skills (BIS) with Cabinet Office leading on commercial arrangements.

Lord Freud, Minister for Welfare Reform, praised the initiative: “Richer Data means that anyone making a payment could add much more information about a transaction, not just the current 18 character limit. This could bring a wide range of benefits, from allowing automatic invoice reconciliation for business to enabling individuals to see more information with payments they receive. Richer data could also lower the cost to the taxpayer of administering benefits and reduce losses from error and fraud.”

DWP has already identified that richer data could help it more quickly reconcile information it receives in administering the benefits system. It could also offer benefits to individual claimants, making their reporting of financial data to the Department easier.

The announcement comes as the new Payment Systems Regulator (PSR) is preparing to become fully operational on 1 April 2015. The Payments Council says that should there prove to be a feasible and commercial proposal for richer data, the industry will consider bringing this forward for review by the PSR’s proposed Payments Strategy Forum.

Andrea Leadsom, economic secretary to the Treasury, says: “The development of payment systems in the interests of all users is central to improving competition and outcomes for customers; this is exactly why we created the new Payment Systems Regulator. Richer data offers some exciting avenues for innovation, and it is right that government and the industry works together to explore the case for developing these."

Comments: (1)

Christopher Williams
Christopher Williams - RTpay - Winchester Uk 19 December, 2014, 12:33Be the first to give this comment the thumbs up 0 likes

It would be ideal to see extra data attached to the transaction, to include VAT information to enable it to be extracted during the course of a transaction, at least in some situations.

The commencement of the VAT on digital goods change from January, 2015 (to be based on the residency of the buyer, not the base of the merchant) gives an initial target for real time VAT collection.

Merchants are expected to be able to perform relatively complex data analysis, including in some cases, having to manage the FX risk on three currencies in a single transaction, so it makes a lot of sense to assist them by having a central core reporting format.

Of course, nobody really likes paying taxes, but perhaps the better view is to think how to reduce the $200 billion per annum loss in the EU to VAT to a reasonable level. Adding data to the transaction is a very good way to start.