Digitization has permeated into all facets of business operations, and business banking is no different. GIRO stands out as the undisputed forerunner in spearheading the electronic payment revolution for businesses in Singapore. However, there were instances where the technicalities involved with GIRO payments overpowered the convenience it offered. To overcome these challenges, eGIRO was introduced in the business banking sphere.
What is eGIRO?
eGIRO can be thought of as a successor to the traditional GIRO fund transfer method. eGIRO functions similarly to GIRO but exempts businesses from longer turnaround times and the dependency on paper-based applications.
Development of eGIRO:
It’s no secret that GIRO has provided unmatched convenience for settling recurring transactions, allowing businesses to foster positive relationships with their vendors. However, the concept of GIRO payments had shortcomings that obstructed Singapore’s goal of becoming a smart financial hub. Being a predominantly paper-based process that necessitated manual application collection and submission, GIRO fell short of being the smart payment solution that businesses had envisioned. In light of this, a completely electronic mode of payment- eGIRO- was developed toward the end of 2021. eGIRO was developed by the Association of Banks in Singapore in collaboration with eight other leading banks.
How is eGIRO different from traditional GIRO?
The most obvious difference between GIRO and eGIRO is the mode in which they’re carried out. GIRO is paper-based payment instruction such as cheque, while eGIRO is electronic. Apart from this obvious difference, below are several more distinctions that set eGIRO apart from traditional GIRO.
- Processing time: As businesses are required to physically collect and submit forms when making or collecting payments using GIRO, it can take considerably longer for a GIRO payment to be processed by the bank and the billing organization. The GIRO payment process can take anywhere from three to four weeks to be finished. eGIRO, on the other hand, provides a faster process that only takes a few minutes for non-business transactions and up to 48 hours for corporate transactions.
- Setup: Traditionally, GIRO could only be set as a payment method by directly contacting the bank and filling out sophisticated forms. With eGIRO, most of this is no longer a necessity, as the setup can happen electronically and in less time.
- Technology: eGIRO utilizes cloud technology, APIs, microservices, and other leading advancements that were previously absent from paper-based, traditional GIRO.
- Accuracy: Since eGIRO is carried out completely online, it is less prone to errors. The system can generate prompts for the payer to crosscheck and verify the details they’ve entered before conducting a transaction. This feature was absent from traditional GIRO, where inaccurate paper-based manual entries could lead to confusion and latency.
- Safety: Since eGIRO relies on sophisticated encryption technologies, businesses can be assured that the information they’re sharing with their respective banking portals is kept safe. Furthermore, eGIRO transactions can be electronically canceled, which ensures that any erroneous transactions or potential issues can be swiftly addressed. This feature enhances the safety and control businesses have over their financial transactions. Features like encryption and instantaneous cancellation are absent from traditional GIRO.
- Availability: Traditional GIRO transfers occur in batches, and the submission period for the forms is mostly limited to working hours. However, with eGIRO, a transaction can be made at any time of the day.
How to set up an eGIRO payment?
- Choose bank: When visiting a billing organization’s page to make an eGIRO payment, the payer would be asked to choose the bank where they’ve opened their business account. This is the first step to making an eGIRO payment.
- Log into the online banking portal: The payer will be redirected to their respective online banking portal. Once accessed, details about the payments will be required, such as the amount to pay and the frequency of the payment.
- Authenticate: Lastly, the payer would be asked to authenticate the payment by entering a unique PIN or passcode. The authentication method can differ between different banks.
Final Words:
eGIRO proves to be more efficient than GIRO due to its availability, speed, security, and accessibility. Being a completely online payment method, eGIRO saves businesses from being involved in lengthy paper-based processes. In essence, eGIRO serves as a catalyst for streamlined financial transactions for businesses in Singapore.
