ABA encourages PayID use as means to prevent scams

Through PayID, users are able to transfer money using a mobile number or an email address rather than the traditional combination of a BSB and account number. 

However, as highlighted by the Australian Banking Association (ABA) in this latest campaign — coined Australian Banks: Working to Protect You — PayID can also be used to lessen the risk of scams. 

According to ABA chief executive Anna Bligh, PayID can help prevent scams because, unlike a traditional payment, “the payer can see a confirmation screen, which includes the intended PayID name, before they confirm the payment”.

“The more payments we see using PayID, the more protected customers will be,” she said. 

According to a May survey of over 2,500 consumers and businesses commissioned by NPP Australia, one in four payments to a PayID are either stopped or edited to ensure that a mistaken payment or scam activity isn’t taking place. 

Ms Bligh also commented that, in a bid to encourage safe financial practices, the association is encouraging customers to find out more about PayID, and that its website links directly to participating banks while also highlighting what is available with each lender. 

The ABA CEO added that there are currently more than 11 million PayIDs, but that the ABA wants more people to sign up. 

“Customers can have multiple PayIDs, including their phone number, registered emails, or even their ABN in the case of a business,” Ms Bligh added. 

According to the ABA, this campaign will track both increased PayID registrations as well as the growth in payments made to a PayID instead of a BSB and account number. 

Late last year, as part of the ACCC’s Scam Awareness Week, industry bodies including the Council of Small Business Organisations Australia (COSBOA) and the Australian Small Business and Family Enterprise Ombudsman (ASBFEO) flagged the importance of PayID for small businesses. 

According to the bodies, platforms like PayID enabled safer digital practices for online businesses. 

The Customer Owned Banking Association (COBA) has welcomed the ABA's campaign, with Leanne Vale, director of financial crimes and cyber resilience at COBA, flagging that the ACCC recently found that Australians lost a record amount of more than $2 billion to scams in 2021.

"PayID presents the person making the payment with a confirmation screen. As this step includes the intended PayID name, this allows them to check the destination is as intended before confirming the payment." Ms Vale said.

"COBA members were some of the first banks in Australia to introduce the New Payments Platform (NPP) and PayID for their customers, and we will continue to promote activities that keep people safe from financial crime.

"This is a strong message to scammers from both the ABA and COBA that Australian banks will continue to invest in digital security and educate the public on how they can protect themselves and their finances from fraud," Ms Vale said, urging any customer-owned banking customers who are yet to register a PayID to contact their bank to find out more and set this function up for even safer digital transactions.

[Related: CBA introduces AI technology to combat scams]