jamtronix

So far in this series on Australian Payment Systems I've talked about 3 payment systems - BECS (for transferring money between 2 australian bank accounts), EFTPOS (aka CECS) for debit & credit card processing, and RITS (used to perform 'high value' transfers in real-time).

I've also shown how both BECS & CECS end up settling through RITS, and I've shown how the processing & settlement of BECS & CECS transactions is done on a peer to peer basis. In other words, each participant needs to setup both a legal agreement and a communications link with every other participant. (In network-speak, this is called a fully connected topology)

This means that any financial institution that wants to let it's customers send direct entries, or wants to issue a credit card, needs to have a couple of racks of comms gear, a bevy of prime grade server wranglers, and some good commercial lawyers.

While that kind of overhead is no sweat at all for CBA, it's a bit of a stretch for a single office credit union with 2.75 employees. So there are a number of organisations that act as 'aggregators' in to BECS & CECS. For example, most credit unions will use either CUSCAL or CreditLink as an agent for processing BECS direct entries.

Each credit union is assigned a BSB, where the first 2 digits (the 'Bank' part) points to the aggregator that acutally peers with the banks. The aggregator is responsible for collating all the individual outbound transactions from each credit union, and forwarding on any inbound transactions, and performing any settlement.

The aggregators settle with the banks via their Exchange Settlement Accounts (ESAs) at the RBA. The aggregators don't have accounts for individual customers, instead they track the balance of each credit unions total funds. (i.e. there will be one account at the aggregator for each credit union). Then each credit union is responsible for tracking how their total funds at the aggregator is divided up in to individual customer accounts.