by Gabriel Chen

AN INITIATIVE by DBS Bank could address the frustration felt by many consumers at the long processing time taken for Giro applications.

A new monthly Giro deduction payment at any of the banks here can take as long as four to six weeks.

This contrasts unfavourably with a new credit card, for instance, which can be issued by a bank in a matter of days.

The DBS initiative is aimed at simplifying the process - and it could cut weeks from the processing time.

Come the first quarter of next year, DBS will allow its customers to apply to pay by Giro via its AXS terminals.

The initiative - a first in the fiercely competitive consumer banking scene here - makes Giro applications even more convenient and accessible.

All customers need do is swipe their DBS card on the AXS terminal, key in their PIN, and pick from a list of major billers. The bank has more than 500 AXS machines in Singapore.

Some online application options exist at other banks, but this initiative enables Singaporeans without Internet access to enjoy the benefits.

Mr Rajan Raju, head of DBS' consumer banking group, said initially the bank expects to have 15 to 20 billers on this electronic direct debit authorisations, or eDDA, setup.

Mr Raju added that customers will benefit from the eDDA setup as their waiting time would be cut by several weeks.

Giro applications usually take longer to process than, say, credit cards. Credit cards can be processed fairly quickly as just one bank is involved.

The bank initiates the various checks so that it can get the plastic into the customer's hands as rapidly as possible.

Giro applications are more complicated and involve several organisations. Typically, they involve a biller such as SingTel or Singapore Power. Then there is the biller's bank, which receives the payment and finally, the customer's bank which arranges payment.

The DBS initiative would cut processing time as it would be both the biller's bank and payer's bank. Time is saved on the customer having to fill up a Giro application form.

Industry watchers have welcomed the eDDA initiative given the prospect of faster Giro application processing. DBS is the largest shareholder of AXS. Although customers of other banks use the terminals, it is not known if these banks will offer the scheme, but the cost of implementation could be a deterrent.

Still, there are already some speedy alternatives out there.

OCBC Bank's head of group operations and technology division, Mr Denis Malone, said its customers can use its all-in-one Giro service for some billers, submitting their requests via the Internet or the all-in-one Giro forms.

'We process these requests and send an electronic file to the billers. This eliminates any physical transfer of forms and speeds up the turnaround time by as much as 50 per cent,' he said.

DBS' customers can also use its Internet banking to set up immediate direct debit authorisations, while Standard Chartered Bank said it will be offering customers online Giro application soon.

Some billers also use Nets to process applications quickly.

This article was first published in The Straits Times on September 9, 2008.