Account-to-account (A2A) and request-to-pay (R2P): 5 exciting use cases for consumers

Munich, September 22, 2022. “The mobile banking app will become the center for payment functionalities,” is the outlook of Holger Teske, co-founder and CEO of Gini, a leading company for data extraction from documents, on future developments in the field of payments. A significant role will be played by Request-to-Pay as a basis. It is based on the existing SEPA scheme and enhances it with a very high level of convenience and security – both for merchants and end customers.

Request-to-Pay provides end users with new options

What is special about Request-to-Pay is that the scheme allows documents such as invoices to be integrated and retrieved in addition to payment information. Payment initiation leads to an agreement that is linked to payment execution. A payment request is upstream, which the debtor, such as the end user, can then confirm and trigger. The actual payment execution takes place immediately or based on the agreement at the agreed time.
If the merchant allows it, the user can postpone his decision to a later time. The flexibility of R2P thus also makes it possible to offer payment on account.*

“Request-to-pay enables usage options that give full control back to the end user and increase financial visibility where users feel comfortable and secure: in their home banking app,” said Demis Estabridis, Head of Innovation at Gini. Right now, many are focusing on the technology behind it, but it’s worth looking at use cases to show where the benefits lie.

Five most exciting use cases for users

1. Purchase on account and Buy Now, Pay Later directly in the banking app

With the “Buy Now, Pay Later” option, end consumers have the chance to purchase products but pay for them later – just like the classic purchase on account. Direct purchase and direct payment are separated in terms of time. It is also possible to agree on installment payments.
The application can be a customer-friendly solution within the customer’s bank and across e-commerce or stationary retail channels. The payment information is issued digitally, and the customer releases the settlement – if necessary in individual installments – at a later date if they wish to keep the products, such as clothing or technical equipment. The advantage of this type of microcredit in installments: The bank knows its customer and is aware of his liquidity, and protects the payee from defaults.

2. Bill push in banking app

Invoices from service providers or service companies such as tradesmen, energy suppliers or telecommunications providers can be pushed directly into the customer’s banking app. They also contain automatic payment reminders, are stored in an audit-proof manner, and are traceably assigned to sales. This is a solution for both end consumers and business owners that simplifies bureaucratic processes in everyday life in addition to payments.

3. Fast P2P payments

P2P payments are becoming increasingly common in everyday life and can be implemented easily and quickly with the appropriate technology. Whether between friends or buying through classified ads, using the long IBAN is always cumbersome and error-prone, so other existing payment systems from large providers are used. However, users could quickly connect via QR codes or NFC smartphones, for example, and trigger payments immediately.

4. Collecting money

One can set up a collection platform for certain occasions, such as weddings, births, or group trips made by several people. Everyone digitally puts money into a pot, which is used for the planned purchase. This way, not one person is solely responsible for collecting the money, but all participants are together.

5. Ease donation payments

Fewer and fewer people carry cash or small change with them all the time. This development has accelerated in Germany, mainly due to the Corona pandemic. This also directly impacts potential donations for street musicians or those in need, such as vendors of homeless newspapers. With a QR code, supporting payments to them can be made easily and quickly.

*Technical flow of the process: first, the payment agreement takes place – for this, the request-to-pay scheme based on ISO 20022 standard or PAIN messages (PAIN = PAyment INitiation) is used. Then, based on the payment agreement, the payment is executed immediately (SCTinst) or within one banking day (normal SCT transfer run). However, depending on the agreements, it is also possible to pay at a later point in time.