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The Australian Payments Landscape


8 June 2018

Victoria Galloway

5 minute read

The payments landscape in Australia: Trends and opportunities

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The Australian payments industry is at a tipping point. A cashless Australia is emerging on the horizon powered by such trends as contactless payments and real-time transactions thanks to the New Payments Platform (NPP) launched in February 2018.

These changes have deepened the foundation for the burgeoning ‘New Retail’ trend, where consumers have multiple interactions with your product or service across different platforms before they make a purchase decision. This has catapulted omnichannel payments to the forefront, which in turn necessitates the seamless integration of your brand experience, payment methods and service.

With this in mind, if your business is one of the 2.24 million Australian businesses actively trading online, now is the time to think about what these changes mean for your business and what you need to do to be prepared for the future. Read on to know more about the top developments in the Australian payments landscape in 2018.

#1. Real-time payments: Australia’s New Payments Platform (NPP) spurs innovation

The NPP might not have made a loud splash when it launched in February 2018, but it is the biggest milestone of the year for the Australian payments industry and has opened the doors to further innovation in payments as Australia strives to go cashless.

What is NPP?

The NPP is Australia’s new payments infrastructure that enables businesses and consumers to make real-time payments. It will work alongside the current online payment methods used in Australia, such as BPAY. However, what truly sets the NPP apart is that it allows users to transfer money using a phone number or email address as opposed to a bank account number or BSB number.

How will the NPP benefit your business?

In addition to providing convenience and speed to everyday B2B and B2C transactions, the NPP brings some distinct benefits for businesses. These include:

  • Better cash flow thanks to real-time and hassle-free payments. This is good news for transactions taking place between different Australian time zones.
  • Quicker bank reconciliations will be possible thanks to the real-time and data-rich nature of transactions, which allow users to include descriptions up to 280 characters. This means more up-to-date and accurate bookkeeping for your business.
  • By bringing real-time, 24/7 payments to consumers’ fingertips, your business can offer customers a quick and easy way to transfer money between accounts no matter what time of the day.

As shoppers demand a frictionless shopping and payments experience, the NPP will help businesses target greater customer fulfilment across single-channel, multi-channel and omnichannel payments.

#2. Mobile wallets in Australia: Growth in number and value of transactions

According to ANZ, the adoption of mobile wallets among Australians was 140% higher this past holiday season compared to the previous corresponding period. The banking leader notes that this “demonstrates a strong demand among consumers for greater choice over the way they pay.”

The good news is that a surge in the use of digital wallets is not confined only to the holiday season - this trend is here to stay. 22% of Australians already use digital wallets. This number is expected to have increased considerably by the end of 2018.

According to a recent Australia Post report, the number of people in the 18 to 36 years age bracket has increased by half a million since the last census and now represents 26% of the Australian population. The demand for payment flexibility, simplicity and transparency from this age demographic have led to the increasing adoption of innovative payment methods such as digital wallets and wearable payments.

But that’s not all. The adoption of digital wallets is also on the rise among people interested in using cryptocurrencies like bitcoin. Google, Amazon, PayPal Masterpass, and Visa Checkout are among the most popular digital wallet choices in Australia.

#3. Instant gratification: Buy Now, Pay Later catches on

Australia Post predicts that by 2020, 1 in 10 items will be bought online. Riding on the back of a burst in eCommerce shopping activity is the Buy Now Pay Later (BNPL) service, which gives shoppers the freedom to pay for products such as clothes, cosmetics and accessories in interest-free instalments.

Nearly 8% of all spends on online goods in 2017 were using the BNPL service. At 57%, fashion shoppers are the most avid users of BNPL, while 10% of beauty transactions were made using this service. With instant gratification being the underpinning appeal of this service, it is consumers in the age demographic of 18-39 years who show a strong inclination towards BNPL retail.

Australia is seeing a steady increase in the number of participating retailers in BNPL services, creating a larger playing ground for schemes such as AfterPay, Openpay and zipMoney.

#4. Efforts to reduce card-not-present (CNP) fraud gain steam

Latest figures from the Australian Payments Network (APN) show that CNP fraud accounts for over 80% of all fraud on Australian cards. As more consumers transact online, the threat of fraud has heightened. Efforts to tackle online fraud have gained traction in 2018 with the APN hosting an accelerator event in cooperation with the Reserve Bank of Australia to create a framework on combating CNP fraud.

Meanwhile, the Australian Government released the first component of its Trusted Digital Identity Framework (TDIF) in February 2018 and will continue to release more components throughout the year. The TDIF is designed to refine the approach towards fraud control, privacy requirements and accreditation.


Whether you use EFTPOS, an online checkout or other alternative means to accept payments, you’ll find that customers love a simple, frictionless payment experience. But when following the latest payments trends, it’s important to also give security and privacy a think.

With Bambora’s innovative and business-friendly packages - designed for both small businesses with limited transactions and large businesses that need a full enterprise payments bundle - you can offer your customers a secure payment experience they will love. Want to know more? Get in touch with us today!

About the author

Victoria Galloway is Bambora APAC's Technical Copywriter, and has been writing and producing in the payments and eCommerce space for a number of years in the UK and Australia.