Request-to-Pay is a messaging system that allows end-to-end digitalisation of the shopping experience. Managed at a European level by the European Payments Council (EPC), this instrument is seen as an asset responding to various use cases within different European countries.
The SEPA Request-to-Pay (RTP) scheme was designed by the European Payment Council (EPC) to create a pan-European messaging standard and is part of a desire to digitalise user journeys. The main purpose of the RTP is to be able to associate an invoice (and more general information relating to the commercial relationship) and a transaction. With RTP, the ‘payment request’ is automatically accompanied by the data necessary for reconciliation. In practice, a creditor (for example a merchant) will issue a payment request with all the data related to the commercial transaction (the invoice, the detail of the product, etc.), but also with all those necessary for payment (IBAN, payment term, etc.) to the debtor (the customer). When he receives it, all the data is filled in and the debtor only has to give his agreement or not to the payment. The latter will be carried out systematically by transfer, instant or not. The RTP, therefore, has the potential to modify financial transactions.
Indeed, for many payment professionals operating in the European context, the potential of Request-to-Pay is based on the combination with instant payment, thus transforming the situation by paving the way for an immediate and digitalised transaction from end to end. But that's not all. By defining the European SEPA RTP scheme, the EPC paves the way for a standardised approach which is a guarantee for supply and demand players operating in different European states, such as large retailers or corporate treasurers. Several conditions remain, however, to ensure the adoption and success of this system: an evolution of the national models of ‘pay by link’ already developed within some European countries towards the scheme defined by the EPC, elements related to strategic aspects – such as questions of an economic model – without forgetting the information and pedagogy to be carried out on this subject to the actors of the demand.
If most European states converge on the interest of this innovation for the evolution of the payments ecosystem, the approach in terms of use cases is relatively different. It depends on national payment models, the offers and actors in place, as well as the habits and uses in terms of payments. Considering the appetite for this innovation, it is interesting to observe that some countries already have a national solution similar to Request-to-Pay and therefore constitute a favourable breeding ground for the development of this solution. This is particularly the case in France with SEPAmail RUBIS, which was created in the aftermath of the SEPA migration to use ISO messages as part of secure messaging around a four-corner model. The solution was intended for B2B and B2C environments to obtain invoice settlement.
Another example is Switzerland, which has developed, thanks to the initiative of SIX and local banking players, the eBill Request-to-Pay solution that appears like a real national standard for electronic invoicing. Another example, this time in southern Europe, is Portugal, which offers, via the national wallet solution MB Way launched in 2015 by the local payment company SIBS, an innovation that works as Request-to-Pay on a national scale.
If B2B seems to be a converging trend in many European states such as France, Italy, or Portugal, especially because of the need for more digitalisation in this specific segment, others seem to rather prioritise B2C and C2B. This is particularly the case in Luxembourg and the United Kingdom, for which the boost for the adoption of Request-to-Pay will come first from the retail segment, particularly in the context of remote payment in ecommerce mode. One of the reasons that are identified, particularly in the United Kingdom, is the increase in payment difficulties in the post-COVID-19 context that reinforces consumers' appetite for messaging solutions to manage bill settlement. Another reason, this time in Luxembourg, is the complexity of invoice management in the business world due to specific regulations in the Benelux countries, which could slow down the development of Request-to-Pay in this specific area.
The other use case identified in the segment of individuals is the G2C and C2G, such as payments to the public administration, which can also be modernised thanks to this solution.
The creation of an alternative to direct debit also seems to be an interesting use case in some European states where consumers are not very interested in this type of payment. Illustration: Portugal where, according to some local professionals, only 50 to 60% of payments to large billers (such as electricity suppliers) are covered by the SDD (SEPA Direct Debit). The Request-to-Pay, in combination with instant payments, would appear in this precise situation as an interesting way to propose a digital solution that would be, this time, in the hands of the payer.
Let's not forget also the payment to some professionals (doctors, lawyers, etc.) or to companies whose services do not necessarily require immediate payment: Request-to-Pay would be an opportunity to define digital alternatives to payment by check (in France, for example) or even transactions in cash in some European states such as Italy, and also a raw material for the creation of innovative combinations such as a request-to-pay/payment facility (such as BNPL) for example.
For more information: Partelya Consulting White Paper ‘Request-to-pay: enjeux et perspectives pour l’Europe des paiements’ published in September 2022 and produced by Andréa Toucinho, Director of Studies, Prospective and Training.
Expert in payments and innovative finance, Andréa Toucinho is Director of Studies, Prospective and Training of Partelya Consulting and Country Ambassador for France of European Women Payments Network (EWPN). France Representative of two national fintech associations – Aefi Spain and Afip Portugal – she published several editorials about payments.
About Partelya Consulting
Partelya Consulting is a French consulting company specialising in payments. Created in 2008, it works with all actors of the market, from banks to schemes and retailers, on technological, strategic and regulatory issues. The company is a member of the French Association du Paiement and contributes to several projects linked with payments and innovation.
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