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Authenticated Collections Update SAFARI into Consumer Credit by Riaan de Swardt 15 October 2014

Authenticated Collections Update SAFARI into Consumer Credit by Riaan de Swardt 15 October 2014. SARB Terms of Reference (TOR). Issued on 3 July 2013

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Authenticated Collections Update SAFARI into Consumer Credit by Riaan de Swardt 15 October 2014

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  1. Authenticated Collections Update SAFARI into Consumer Credit by Riaan de Swardt 15 October 2014

  2. SARB Terms of Reference (TOR) • Issued on 3 July 2013 • Based on the overwhelming support by the collections industry for the enhancement of the current AEDO system, as opposed to the development and implementation of an ACT-type system, the NPSD resolved that the current AEDO system must be enhanced. • The NPSD requires PASA to initiate and mobilise a project team of experts drawn from the stakeholders in the collections environment, ie. banks as well as non-banks who are able to technically and legally design, develop and implement the industry's preferred solution, namely the enhancement of the current AEDO system.

  3. SARB Terms of Reference (TOR) • The solution must address the NPSD's minimum requirements and be implementable across the industry within the shortest time possible. • The enhancements will focus on sound flexible mandates and authentication that meet an industry accepted standard, and can be developed and implemented across the board.

  4. SARB Letter 24 July 2014 Simplified Processing Hierarchy The SARB has no objection to the simplified processing hierarchy… subject to the condition that the end state does not include any non authenticated debits being processed in the early window. In the end state, the TOR envisages the processing of NAEDO and EFT debits after the AC/AEDO debits…

  5. SARB Clarification Letter 25 August 2014 “…AC, AEDO and NAEDO Processing: • Only AC and AEDO transactions may be processed in the early processing window from the end state (June 2017) • No NAEDO transactions will be processed in the early processing window in the end state, nor any other non-autenticated transactions • The 24 month timeframe, comprising of the agreed upon assessment/evaluation period and migration period, commencing from the June 2015 implementation date, does not imply that the AC implementation may be delayed. • Upon commencement of the second 12 months (June 2016), no new NAEDO contracts may be initiated for processing in the early processing window. • NAEDO processing may however be considered in the non-authenticated debits space, afterthe early processing window has concluded”

  6. Typical Deduction Day D A Y 1 D A Y 2 PROCESSING OF AC TRANSACTIONS -Final 0 0 H 0 0 N E T S A L A R Y C R E D I T S 0 0 H 1 0 A C 1 S T RUN 0 5 H 0 0 AC FU L L TRACKING 0 6 H 0 0 DATA TO ENDUSERS 05 H 1 0 DATA BANKS 14 H 0 0 AC 2 ND RUN 19 H 0 0 ? EFT DEBIT ORDER 0 7 H 0 0 ? NON AUTHENTICATED 1 RUN ONLY

  7. Clarification: Authentication Authentication means: • Customer verification by the Paying Bank • Account validation by the Paying Bank • Mandate authorisation by the Customer • User / Originator verification by the Acquiring Bank

  8. Clarification: Enhanced AEDO Changes… • Enhanced AEDO • Variable Amounts • Specify Bank Account details • Ability to have a once off change of reference number (Application to final contract number) • Decentralised mandate databases housed with banks and CSP’s

  9. Clarifications: AEDO vs AC Determine if AEDO could be enhanced to meet the Criteria for the Authenticated Collections environment. IfAEDO could not meet the Authentication Criteria it would be designated to the Authenticated Collections and processed early.

  10. 5. AC : where are we?

  11. Project Roadmap (28 Aug2014) 30 June 16 30 June 15 30 June 17 13 Oct 14 07 Apr 15 15 Nov 13 28 Aug 14 02 Oct 14 21 Oct 14 08 Sept 14 Initiation Definition Execution Development Design Implement Validate TRS FRAMEWORK DEVELOPMENT UPDATED SID SARB TOR IMPLEMENTATION PLAN DEVELOPMENT TRS FRAMEWORK APPRROVAL PROJECT MANGEMENT PLAN APPROVAL INTERPRETATION OF SARB TOR TESTING PHASE TRS DEVELOPMENT BRD APPROVAL (WORKGROUP) INDUSTRY READY TRS APPROVAL (WORKGROUP) EVALUATION / STABILIZATION BRD RATIFICATION (STEERCO) TRS RATIFICATION (STEERCO) TRANSITION / MIGRATION IMPACT ANALYSIS SINGLE HIERARCHY JUSTIFIED FEEDBACK TO SARB LEARN OPERATE OPERATE SUPPORT

  12. “4 potential use cases” SA“SECURE DEBIT”

  13. USE CASE: TT1 • Transaction Type 1:- • Non-face-to-face • Authentication key not included • Request online • Response 15 minutes / end of business day (Clearing Rules will determine)

  14. USE CASE: TT2 • Transaction Type 2:- • Non-face-to-face • Authentication key not included • Batch request day 0 queued by BankServ until 20H00 • Day 1 from 08H00 send to payers for authorisation. Replies received batched and returned. • Final Batch responses Day 3 08H00

  15. USE CASE: TT3 • Transaction Type 3:- • Face-to-face • Authentication key included • Card, PIN, Secure POS • AEDO and Enhanced AEDO • Request online • Response online

  16. USE CASE: TT4 • Transaction Type 4:- • Non-face-to-face • Payer required to pre-register • Authentication key included (after pre-registration) • Request online and response online • Optional: Only ABSA & Standard Bank

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