The standard payments process means it can take days for payments between different financial institutions to ‘clear’, but with the launch of Osko, that delay could become a thing of the past for some consumers.
At the time of writing, Osko is available to the customers of more than 60 Australian banks and other financial institutions. But what exactly is it, how does it work, and who can use it?
What is Osko by BPAY?
Osko is a service from payments platform BPAY, which was launched in February 2018. It’s designed to facilitate the real time transferring of funds between individuals or businesses and is one of the first services to operate using the New Payment Platform (NPP).
It allows customers to make near instant payments from one bank account to another, either by using a BSB and account number or a PayID, which is another of the banking services which was introduced as part of the NPP. We explain how PayIDs work below.
Financial institutions offering Osko generally make it available to their customers through mobile and online banking, but certain banks may only offer it via one of these methods.
According to BPAY Group CEO John Banfield, over $2 million was transferred between customers on Osko’s launch day, and at the time of writing over $20 billion had been transferred using Osko since its launch.
The table below displays a snapshot of 5-Star Rated transaction accounts on Canstar’s database for high transactors (individuals averaging 35 transactions a month) in NSW, sorted by Star Rating (highest to lowest) and then by provider name (a-z). Check upfront with the provider and read the PDS to confirm whether the provider offers Osko as a service to customers, and whether the product meets your needs, before opening an account.
How does Osko work?
Osko works by utilising the NPP. This is a payments infrastructure developed by the Australian banking industry to allow for innovations including near-instant transfers – even at late hours of the night and on weekends – as well as PayID.
Osko allows you to make payments to other individuals or businesses using one of two different identifiers: either their PayID or their traditional account details.
When you make or receive a payment using Osko, you may notice the service’s logo on the payment confirmation screen.
An important point to note is that Osko isn’t a standalone app or website which you use to make payments. Instead it’s designed to work within your financial institution’s app or website. The specific way providers offer Osko may vary, and in fact, not all financial institutions offer it to their customers.
Another feature of Osko is the fact that payments can be sent with longer descriptions – up to 280 characters, including emojis, letters, numbers and symbols. This may come in handy for people who regularly receive a large number of payments and need detailed reference or invoice details, such as tradies or contractors.
Are Osko payments secure?
There have been some concerns raised regarding how instant payments could leave customers open to fraud, as there could be less opportunity to stop suspicious transactions once they have been made. However, on its website, Osko claims that it “uses cutting-edge technology and is subject to very high data security standards”.
Osko also says that security is monitored 24/7 and that all payments are subject to participating financial institutions’ real-time fraud screening.
However, Osko does advise consumers to “remain alert to cons and scams”, particularly suspicious or unexpected requests for payments via social media, emails or SMS.
What is a PayID?
PayID is another of the new services developed as part of the NPP. It lets you link a piece of personal information like your mobile phone number or email address to your bank account. This piece of information then acts as an identifier for your account and can be used by other people when they transfer money to you, rather than having to remember and enter your BSB and account number. In the same way, you can use someone else’s PayID to send money to them.
Faster and simpler payments are coming! With Osko by BPAY, payments are as fast as cash – without the hassle of cash. And with PayID, payments are made simple using just a phone number, email address or ABN. pic.twitter.com/g0ZUv6Spz9
— SCU (@SCU_banking) January 30, 2018
That being said, if you don’t have a PayID or if your bank doesn’t support the PayID service yet, you may still be able to receive near-instant payments with Osko using your BSB and account number, as long as your bank supports Osko.
Can I use Osko?
Your ability to make and receive payments using Osko will depend on which financial institution you’re with. Some have rolled Osko out fully to customers, some have made it available on a limited basis, and others currently do not offer it at all.
You can check whether tour financial institution offers the ability to make payments with Osko here.
If your bank currently doesn’t offer the Osko service, but you want to be able to make instant payments, it may be worth considering a transaction account with a bank or credit union which has rolled out Osko to its customers. You can compare transaction accounts with Canstar. But make sure to check upfront with the provider whether they offer Osko, and consider the account’s other features, terms and conditions before committing.