If you run a business that bills people regularly: a gym, a salon, a cleaning service, a consultancy on retainer, you already know the quiet cost of getting paid. It’s not just the late invoice here and there. It’s the reminder emails you have to send, the card that quietly expired without anyone noticing, the direct debit that takes three days to clear when you needed it yesterday.
Australian businesses are looking for faster, more transparent ways to collect payments. PayTo offers a modern alternative to traditional direct debit by combining customer-approved payment agreements with the real-time capabilities of Australia’s New Payments Platform.
If any of this sounds familiar, PayTo was built with you in mind:
- Late payments that drag out week after week
- Manual invoice chasing that eats into admin time
- Card expiry and failed card payments
- Slow direct-debit settlement
- Limited visibility over recurring payment agreements
PayTo is Australia’s digital, account-to-account payment method for one-off and recurring collections. It lets a customer approve a payment agreement through their own banking app, before a business ever initiates a payment from their bank account.
PayTo explained in simple terms
PayTo is a digital payment method available through participating Australian financial institutions. Here’s the basic shape of it:
- A business creates a PayTo agreement with a customer.
- The customer reviews and authorises the agreement in their banking app.
- Once active, the business can initiate payments according to the agreed terms.
- The agreement can cover one-off, recurring, fixed, or variable payments, depending on how it’s set up.
It’s important to be clear about what PayTo isn’t. It’s not the same as manually asking a customer to transfer money each time. PayTo is a customer-authorised payment arrangement – the customer gives explicit permission upfront, and the business initiates payments within those agreed terms from then on.
For businesses evaluating PayTo Australia as an option, Stripe’s 2026 guide to PayTo agreements is a useful reference. It explains that a PayTo agreement is a digital mandate stored in the Mandate Management Service – effectively the record that governs what a business is and isn’t allowed to collect.
How do PayTo payments work?
Picture a cleaning company that bills clients $220 a month. Instead of asking each client to enter card details (and re-enter them every couple of years when the card expires), the business sets up a PayTo agreement specifying the amount and the monthly frequency. The client gets a notification in their banking app, reviews who’s asking and for how much, and taps approve. From that point on, the business initiates the payment each month, the client gets to see exactly what’s being collected and when, and there’s no card to fail.
The process runs in four steps.
Step 1. The business creates an agreement
The business specifies the customer, payment amount, or payment limits, frequency, start date, and other relevant terms.
Step 2. The customer receives the request
The customer receives the agreement through their participating bank’s online banking platform or mobile app.
Step 3. The customer reviews and authorises it
The customer confirms the business identity and reviews the payment terms before approving or rejecting the agreement.
Step 4. Payments are initiated and confirmed
After approval, the business initiates payments within the agreed terms. The business receives payment status information, while the customer can generally view and manage the agreement through their banking channel.
What are NPP payments, and how does PayTo fit in?
Three terms tend to get used interchangeably, but they mean different things:
Term | Simple explanation |
NPP | Australia’s real-time payments infrastructure |
PayID | An address that can be used to receive an account-to-account payment |
PayTo | A customer-authorised arrangement that enables a business to initiate payments |
The New Payments Platform, or NPP, launched in February 2018 and was designed to support near-real-time payments 24 hours a day, seven days a week. As of 2026, AP+ states that more than 120 financial institutions offer NPP-enabled payment services, including Osko, PayID, and PayTo.
To be clear: PayTo is not a separate bank account or card network. It’s a payment service that operates through the NPP ecosystem – the mandate layer sitting on top of Australia’s real-time payment rails.
PayTo vs direct debit vs card payments
Feature | PayTo | Traditional direct debit | Card payments |
Customer authorisation | Digital agreement through banking channel | Often uses a direct-debit authority | Card details entered or tokenised |
Settlement | Designed for real-time processing | Often batch-based | Depends on the card network and provider |
Customer visibility | Agreement can be viewed and managed through banking | Visibility varies by bank and provider | Usually visible in card account |
Recurring payments | Yes | Yes | Yes |
Card expiry risk | No card expiry | No card expiry | Yes |
Customer control | Customer can manage the agreement | Processes vary | Customer manages card or merchant subscription |
Business access | Usually through a sponsoring bank or PSP | Through a direct-debit provider | Through a payment gateway or acquirer |
PayTo may improve speed, visibility, and payment administration – but it isn’t automatically the right fit for every business. Provider availability, bank participation, pricing, customer adoption, refunds, disputes, and integration requirements are all worth assessing before switching.
The RBA’s 2026 assessment of BECS decommissioning is a useful reference here. It presents PayTo as a modern alternative to BECS, while also recognising that the transition is still developing.
Benefits of PayTo for Australian businesses
More predictable cash flow
Businesses can receive payment status information quickly, reducing uncertainty around when money will actually arrive.
Less manual payment chasing
Automated payment agreements can reduce the need for repeated reminders and follow-up emails.
Better customer visibility
Customers can review the business name, payment terms, frequency, and amount before authorising the agreement – building trust from the outset.
Fewer card-related problems
PayTo doesn’t depend on card numbers, expiry dates, or replacement cards.
Easier reconciliation
Real-time notifications and richer transaction information can make it easier to match payments with customers and invoices.
Is PayTo secure?
The short answer is that it’s built to be, by design rather than by promise. Every agreement has to be explicitly authorised by the customer through their own bank; A PayTo agreement needs to be authorised by the customer, so it can’t be set up on their behalf without their approval. Businesses don’t need to store card numbers at any point, which removes a common point of failure. And because the customer can see the business name and terms before approving, it’s genuinely harder for a payment request to sneak through that doesn’t match what was agreed. That said, no payment system removes risk entirely; it’s worth customers checking a business name looks familiar before they tap approve, the same instinct you’d apply to any online payment.
How can a business start using PayTo?
A practical checklist:
- Identify whether the business needs one-off, recurring, fixed, or variable collections.
- Choose a bank, payment service provider, or PayTo-enabled platform.
- Confirm onboarding, pricing, settlement, refunds, dispute handling, and reporting.
- Create a customer agreement with clear payment terms.
- Test the customer approval and payment-notification process.
- Start with a small customer group before moving recurring customers across.
- Monitor approval rates, failed payments, cancellations, refunds, and reconciliation time.
One thing worth knowing upfront: most businesses don’t connect directly to the NPP. Access to PayTo typically happens through a sponsored PayTo User or payment provider; which is where a PayTo-native platform comes in.
That’s the gap Cashwo was built to close. It’s a PayTo-native platform, regulated under an Australian Financial Services Licence, made for exactly the kind of service businesses we’ve been describing throughout this piece; gyms, salons, property managers, consultants, cleaning companies, subscription businesses. You create the agreement, send it to your client by text or email, they approve it in their own banking app, and from there Cashwo handles the collections, the reminders, and the notifications automatically. No card details ever touch the system.
How Cashwo helps businesses use PayTo
Choosing to use PayTo is one decision. Actually running it day to day: agreements, approvals, reminders, reconciliation is another. That’s the gap Cashwo is built to close.
Here’s the Cashwo workflow in practice:
- Create the payment agreement; set the amount, frequency, and terms.
- Send it to the customer by SMS, email, or direct link.
- The customer approves it; through their own banking app, no new app to download.
- Cashwo manages the rest; collections, payment notifications, and reminders, automatically.
Unlike platforms that bolt PayTo onto older infrastructure, Cashwo is built natively for PayTo from the ground up; which means real-time processing, cleaner reconciliation, and no card-expiry chasing baked into how the platform works, not added on top of it.
Cashwo is designed for Australian service businesses that want to automate recurring collections without storing sensitive card details or manually chasing every payment, including:
- Fitness and gym memberships
- Salons and spas
- Consulting retainers
- Cleaning services
- Real estate and property services
- SaaS and subscription businesses
Cashwo operates under AFSL 518990 (Payany1 Pty Ltd), giving Australian businesses a regulated, bank-backed way to put PayTo to work.
Ready to stop chasing payments? Explore Cashwo’s PayTo-powered payment automation.
Frequently asked questions
Is PayTo the same as PayID?
No. PayID is an addressing service, while PayTo is a customer-authorised payment agreement that allows a business to initiate payments.
Can PayTo be used for recurring payments?
Yes. PayTo agreements can support recurring collections when the payment frequency and terms are included in the authorisation.
Does PayTo replace direct debit?
PayTo is a modern alternative to traditional direct debit, but businesses should evaluate provider coverage, customer adoption, pricing, and operational requirements before migrating completely.
Do customers need to download a new app?
Usually not. Customers authorise and manage agreements through the online banking service or mobile app already provided by their participating financial institution.
What happens if a customer wants to cancel an agreement?
They can generally view and cancel it themselves, directly through their banking app, without contacting the business first.
