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PayTo agreements - what are they and how do they work?

  • January 18, 2024   ⎯   mins read
Two people shaking hands.

PayTo is ready to revolutionise how Australian businesses collect payments from their customers. This innovative new payment method offers numerous advanced features, including the addition of electronic payment agreements. But what is a PayTo agreement, and how do they work?

What are PayTo agreements?

A PayTo agreement is a billing agreement between a customer and a business. PayTo removes the need for paper payment authorisations. Instead, payment agreements are digitally authorised through your customer's banking app of choice.

After your customer provides their PayID or account details, they will receive a notification from their banking app prompting them to log into their app and accept the agreement from the secure confines of their banking app. 

Once the PayTo agreement has been accepted by your customer, your business will be able to commence billing according to the agreed payment plan. Customers need only accept the payment agreement once - giving authorisation to all future payments in the payment plan. 

A bonus of electronic agreements is they provide near-irrefutable evidence that a customer has consented to being billed. This offers your business protection when dealing with customer-initiated disputes.

These payment agreements are stored in a centralised, secure and encrypted database managed by NPP Australia. NPP Australia is the developer of the shared infrastructure used by key players in the Australian banking industry. 

How do customers use PayTo?

Customers can opt-in to using PayTo for their subscription payments using either their PayID or their BSB and bank account number. Once PayTo is requested by a customer, they can complete the process by following these steps:

  1. Receive the payment agreement notification from the banking app
  2. Login to the banking app
  3. Accept the payment agreement

Once the agreement is accepted, payments will begin as agreed.

Throughout the sign-up process, your business will receive real-time notifications when a customer has accepted, paused, or cancelled an agreement, giving you the ability to follow up with the customer before their next payment is due. 

This represents a significant upgrade on traditional direct debit or card payments, where your business would need to wait until the next transaction to see if the payment method was valid, or if the transaction is successful.



Ready to get started with PayTo? Reach out to our sales team at 1300 652 825 or hello@ezypay.com

If you’re looking to learn more about PayTo for your business, continue reading about PayTo.

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