The Australian Payment Clearing Association (APCA) will next month switch on a clearing system for ATM and Eftpos transactions - almost ten years after the project was first mooted.
The Consumer Electronic Clearing System (CECS) will commence oversight and co-ordination of ATM and Eftpos clearing arrangements on 14 December 2000. A management committee for the new system has been appointed by the APCA board under the chairmanship of APCA director Brian Mecklem, general manager global payment systems, National Australia Bank.
Banks, building societies, credit unions and the Reserve Bank are represented on the management committee. Importantly for APCA, retailer Coles Myer has been invited to join the system, and David Howell, general manager electronic payment services, Coles Myer has also been appointed to the Committee.
Peter Smith, APCA’s chief executive officer, says the clearing system has the structures in place to accommodate new players as clearing members. "New membership arrangements in CECS are another step in the process of opening APCA membership to all organisations that clear and settle payments as principals," he says.
Coles Myer’s inclusion is made feasible by the development of a new category of membership called "Merchant Principals" designed to cover merchants which switch Eftpos transactions directly to issuers rather than through an acquirer, as is the norm. "The new membership arrangements will ensure that all clearing participants can contribute to measures to improve the networks’ efficiency and security, and benefit from those measures," adds Smith.
The establishment of CECS completes the process embarked on by APCA in 1992 of putting four clearing systems in place. The paper clearing system was established in December 1993, the direct entry system in December 1994, and the high value RTGS system in August 1997.
"CECS took much longer to establish than we had anticipated," says Smith. "The rules governing ATM and Eftpos clearing are complex and took considerable time to construct. The authorisation process was also drawn out."
Acknowledging the political difficulties which have dogged the project, Smith says that it is important to understand what CECS will not govern as well as what it will govern. "The CECS rules have no application or relevance to the commercial arrangements between acquirers and issuers or between these organisations and their customers. Therefore the rules do not cover pricing issues nor do they affect the commercial bilateral negotiations that underpin entry to the ATM or Eftpos networks," he says.
The CECS rules instead cover the procedures and technical standards that apply to interchanges between acquirers and issuers. "They will benefit potential new players by providing a one-stop, transparent set of standards for participation," Smith adds.