Role of Proxy Lookup Service Operators (PLSOs)
Proxy Lookup Service Operators (PLSOs) enable Nexus payments to be addressed using proxies (or aliases), such as mobile phone numbers, rather than account numbers.
Note: This guide assumes that each Instant Payment System has one – and only one – corresponding proxy lookup service. This is the case in most countries. However, in the euro area and the USA there may be multiple IPSs and multiple (often competing) proxy lookup services. This raises a number of complications that will be addressed in a future phase of development.
In many countries with instant payment systems (IPSs), payments can be addressed using “proxies” (or “aliases") in place of account numbers. A proxy (or alias) is any string of text that can be mapped to a specific bank account.
Commonly used examples include:
- Mobile phone numbers
- Email addresses
- National ID numbers
- Company incorporation numbers
Proxies are linked to existing accounts. Before a payment can be credited to the ultimate recipient, the proxy must be looked up and “mapped” to the corresponding account number. Multiple proxies could link to one account, but ideally a single unique proxy should only ever map to a single bank account.
This requirement is not always met. For example, where there are multiple competing proxy schemes in a country and no coordination between them, the same proxy (eg a phone number) could be registered in multiple schemes and linked to different accounts in each scheme.
Different countries have different formats of proxies as well as different levels of adoption. The table below shows some examples.
COUNTRY | PROXY SCHEME | PROXIES | NOTES |
Australia | PayId | Phone number Email Registered business number | Addressing service provided by IPS operator (the New Payments Platform). |
India | UPI | Mobile number Virtual Payment Address (UPI ID), Aadhaar ID (non-mandatory national identity number) | UPI ID has the format [email protected] or [email protected] Only the bank is able to map the name element to a specific account; the IPS operator does not have this information. |
Malaysia | DuitNow | Mobile phone number Business registration number National ID number | The majority of account holders have linked their phone number to an account. |
Singapore | PayNow | Mobile phone number Unique Entity Number for corporations National ID number Virtual payment address | Significant adoption. Also used for payments from individuals to smaller businesses. |
Sweden | Swish | Mobile phone number | High adoption: the majority of Swedish adults are registered with Swish |
UK | PayM | Mobile phone number | Majority of account holders have not linked their phone number to an account via the PayM service. Service will be shut down in 2023 due to limited adoption. |
Nexus allows the use of proxies for cross-border payments. In principle, any proxy that is valid for domestic payments should also be valid for Nexus payments. (This is dependent on the relevant proxy service provider being onboarded and connected to Nexus.)
In Nexus, a proxy lookup request can be made by a customer of any PSP that is a participant in Nexus.
For Senders and Recipients of Nexus payments, the use of proxies improves the user experience:
- Easier to share details: It is usually easier for the Recipient to share a phone number or email address than either (a) a bank identifier and account identifier, or (b) an International Bank Account Number (which can be 20-32 characters).
- Reduce sharing of sensitive data: A payment can be addressed to the Recipient without the Recipient having to share sensitive account details (or even information about where they hold their accounts)
- Provides confirmation of payee: Proxy lookup services typically provide some way of confirming the identity of the payee, for example, by returning the real verified name of the account holder (as provided by their PSP) or a nickname defined by the user. This helps to give the Sender confidence that they are sending funds to the correct account, as well providing a defense against fraud.
Nexus will not provide its own proxy service or proxy format; users cannot register with Nexus to create a global “Nexus ID’.
Proxy Lookup Service Operators (PLSOs) provide the databases which map proxies to specific Payment Service Providers (PSP, including banks) and accounts at that PSP.
PLSOs typically provide:
- A database of proxies and associated PSP identifiers and account numbers / identifiers
- A method for account holders to register and deregister proxies, or change the account linked to a specific proxy, via their authorized PSPs
- A method for PSPs to make a lookup request to the proxy lookup service (ie sending a proxy and receiving back a PSP identifier, account number and name of the account holder)
In many (but not all) countries, the PLSO is the same entity as the Instant Payment System Operator (IPSO), and the instant payment scheme and proxy lookup scheme are managed by the same entity.
A simplified example of a proxy lookup database is below:
PROXY | PROXY TYPE | ACCOUNT NAME | PSP IDENTIFIER | ACCOUNT IDENTIFIER |
+6581234567 | Mobile Phone (MBNO) | Wei Long | DBSSSGSG | 2001009001 |
T09LL0001B | Corporate ID Number / Certificate of Incorporation Number (CINC) | Global Trading Pte Ltd | UOVBSGSG | 3012929741 |
Proxy Lookup services are not available in all countries or payment communities. Whether or not a proxy service is available, Nexus still allows payments to be addressed using traditional account details, such as:
- International Bank Account Number (IBAN), in countries that accept IBAN
- Local PSP identifiers (such as BIC) and local account numbers
A country that does not have a proxy lookup service domestically is still permitted to send Nexus payments using the proxies available in the Destination Country.