InPayTech loses clearing house deal with cloud accounting giant Xero
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Payments provider Integrated Payment Technologies has lost its clearing house deal with cloud-based accounting giant Xero.
“The company understands that Xero has written to our joint customer base advising they are moving to another clearing house over the next month or so,” InPayTech (ASX:IP1) announced on Monday.
“This will have an impact on our income and costs.”
A clearing house is an intermediary that settles payments between two or more parties.
InPayTech’s chief executive, Mr Robin Beauchamp, told Stockhead the company had been “clearing Super with Xero for about five years”. He had no further comment on the “changed arrangements”.
The company’s clearing house product, known as ClickSuper, is an electronic system that manages payment of superannuation contributions, payroll deductions, salaries and tax payments.
Xero’s website used to tell customers their superannuation payments were “sent off to our third party superannuation clearing house (ClickSuper)”.
However the word “ClickSuper” has now been deleted from the Xero site.
Xero declined to comment when contacted by Stockhead.
InPayTech listed on the ASX in December, after selling 25 million shares at 20c each to raise $5 million. The shares closed Monday at 10c, down from 13c on Friday.
The company was continuing to talk to Xero and noted it had the right to market other products to Xero’s 40,000 ClickSuper customers including its new PayVu instant payment system.
Ironically, PayVu is designed to replace the ageing “clearing house” model for payments.
PayVu allows near-instant processing of payments – rather than the annoying three or four-day wait experienced with clearing houses.
Late this year the Reserve Bank is due to introduce an instant payment protocol, New Payment Platform (NPP), which allows people to send and receive money instantly, even if they are with different banks.
However IP1’s technology PayVu allows that now, Mr Beauchamp said.
“The PayVu product is a radical departure,” Mr Beauchamp said.
“Our patent offers an NPP-like experience now. PayVu is in the market ahead of NPP.”
For example, PayVu allows superannuation payments to clear on the same day, rather than the average 4.2-day delay with traditional clearing houses.
This could allow employees to start earning interest on their funds straight away, or employers to hold superannuation payments in their own accounts for a few extra days.
PayVu is designed as an add-on to cloud-based accounting systems such as Xero, QuickBooks and MYOB. It is now operational with Xero and planned for QuickBooks and MYOB.