eKourier Jan 2021

FINANCE

The world is rapidly changing in many ways. One area is how our customers transact and pay their invoices. PAYMENTS TO KSS AND THE RISKS INVOLVED

significantly.

10 years ago we would have seen:

• Direct debits and credit card payments are completed electroni cally through online sign ups. • Use of paper is becoming less and less. These are exciting times and processes are a lot more automated. Moving to the new website we hope to see all customers signing up electroni- cally and a significant shift to recurring payments. However, new systems bring new risks and there are criminals out there trying to exploit our systems and processes often. WE ARE WORKING WITH OUR BANKS TO IDENTIFY WHERE WE CAN REDUCE RISKS AND EXPLORE ANY FUTURE SYSTEM CHANGES THAT WILL REDUCE FRAUD ATTEMPTS • If a customer pays with a credit card in store and does not have the correct pin and wants payments made in smaller batches, please do not accept these payments. • If a credit card is signed up online and something appears odd or not quite right, please investigate further. We have recently seen a person sign up and use a bank account for Going forward be aware of:

• Most payments by cash.

• Many cheque payments.

• Few recurring credit card payments.

• Mailplus collections or cash deposits by centres on a daily basis. • Administration high as Team Members had to manually match cash payments to the correct customer.

• Risk of missing cash.

• Risk of cheque frauds or cheques being cancelled. Many cheques post-dated into the future and Teams had to wait to bank them.

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a direct debit however the bank account was not their account. After 12 months the account holder has disputed the deductions from their account. No alarm bells were raised in this situation. However, should anything appear a little unusual, a great control is to ask the customer to bring in a bank statement to verify the bank account details. As technology changes so will the controls to prevent fraud. The New Payments Platform (NPP) is rolling out with improved changes for direct debits in 18 months time which Kennards will embrace. Before these automated changes come through it is critical we are vigilant to fraud and if anything does not seem right dig a little deeper, ask THQ to contact CBA for support. We are working with our Banks to identify where we can reduce risks and explore any future system changes that will reduce fraud attempts.

• Refunds were often cheques.

A lot has changed since then.

The summary chart provided here is of Payment Types for Australia and how they have changed between January and October 2020: • Cash and cheques are around 3% of the total and declining. • In Australia 51% of our customers are set up on recurring payments through credit cards or direct debits from a bank account. In New Zealand the number is lower at 28% however both Australia and New Zealand are increasing. • 25% in Australia and 54% in New Zealand still prefer to manually transfer funds to pay their accounts each month. • In summary all the data shows us customers are moving away from using cash and cheques. • Mailplus or cash collections at centres are often only once a week and the risk of cash on premises has dropped

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Thanks everyone for your support during 2020 and look forward to a better 2021, working with and supporting everyone.

Anthony Rous Chief Financial Officer

17 Kennards Kourier Jan 2021