HOW DOES NETS WORK?
The original idea behind NETS was to bring the automated teller machine or ATM experience to the point of sale.
Just like using a Personal Identification Number to withdraw cash, customers can enter their PIN to pay for transactions wherever they are.
NETS was first introduced in 1985 for 10,000 ATM card holders from five local banks, which formed a consortium that founded the company. NETS is now owned by DBS, OCBC and UOB.
This group of people could make cashless payments at selected government offices, supermarkets, department stores and petrol stations.
It was part of a national campaign to promote cashless transactions and minimise cash ones, after it was estimated at the time that the government could save S$24.5 million (US$19 million) in labour costs.
The campaign had two other goals: Encourage Singaporeans to receive their salaries via direct credit to their bank accounts; and persuade them to pay bills electronically via the automated, cashless General Interbank Recurring Order or GIRO.
Today, NETS’ unique advantage, according to Mr Chan, is being as ubiquitous as possible.
Most people know the firm for its debit transactions, but it also manages other payment networks in Singapore. Under the NETS group, Banking Computer Services is the operator behind PayNow, FAST and interbank GIRO.
Each time a transaction is made, merchants pay NETS a percentage of the transaction or a set fee per transaction. This still forms the bulk of the company’s earnings.
“We’re definitely not the cheapest today, but neither are we the most expensive. Our price-to-value equation must be very strong,” said Mr Chan, who joined as group CEO in 2020.
He said his team has a huge responsibility to ensure its different payment services work when needed, and the firm is highly regulated for this reason.
“We don’t drive the competitive difference between one payment type or another,” he said. “We are like a utility provider for payments.”
