It needs to address the broader issues revolving around building public awareness and confidence, promoting greater convenience; reviewing business and operating practices and finally, addressing the commercial interfaces between the customers and the service providers. Allow me to take this opportunity to elaborate on these issues. Ladies and Gentlemen, E-payment increases operational efficiency and improves productivity levels through expedient payments and receipts of funds as well as through the reduction or redeployment of resources used for handling cash and cheques. Whilst the migration to e-payment may require considerable investment and effort to provide the enabling infrastructure, the use of e-payments provide consumers with greater convenience and security that would result in cost savings in the long run. In this regard, it is important for the financial institutions and payment service providers to provide more widespread access points for electronic payment services via multiple channels, including the automated teller machines, the point-of-sale terminals, the gated toll and parking gantries and through the network channels and devices, such as the Internet and the mobile phones. Needless to say, the payment products and services need to be continuously enhanced to meet the changing needs of the consumers. BIS Review 84/2005  1  In addition, the efforts to increase the use of e-payments will not only hinge on the capacity of the service providers to ensure that e-payment services are convenient, but also secure. In the area of fraud prevention, the industry would need to be constantly vigilant to maintain consumers'confidence.

The latest mode of electronic payments channel is the mobile banking services that provide convenience to consumers to access a range of payment services such as funds transfers, bill payments and credit card services through mobile phones. In addition, the establishment of an Internet-based multi-bank payment system in Malaysia, the Financial Process Exchange in October 2004, would facilitate online payments for a variety of payments by providing convenience and an efficient channel for businesses and consumers to undertake their payment transactions through the internet. 2  BIS Review 84/2005  While these positive developments will support the attainment of the objective of migration to epayments, the commercial issues between the consumers and the service providers have often times inhibited growth in the volume of the e-payments. The business and pricing models have at times inadvertently promoted a less efficient system, such as in the case of the low price that customers pay for using cheques compared to the Inter-Bank GIRO payments, and the popularity of the credit card against debit card, which is a more efficient system that carries less risk. In addition, service providers have also had difficulties in agreeing on a common business platform, due to their own competitive positioning strategies. Such differences have contributed to containing the increased acceptance of epayments, which is further reinforced by the consumers'need to see a wide spread acceptance by merchants before deciding to use the e-payment mode, while the merchant needs to see a critical mass of consumers before putting in place the required infrastructure.