Be it consumer or business, we have never seen a greater need for faster payments than in the past 18 months. No matter where one stood, accessing funds immediately was imperative. For many, it meant survival. Real-time payments and faster payment processing were the lifeline people needed. There's no going back to the way it was before.
This is the first of our three-part real-time payment (RTP) series. This article aims to provide a general real-time payments overview. We touch on what real-time payments are and who they benefit. We then examine how real-time payments are playing out worldwide and what we can expect to see in Canada.
What are real-time payments?
Real-time payments (RTP) is an always available payment system that delivers funds in a matter of seconds. No matter the time of day, day of the week, send a payment one minute, and settlement happens instantly. This is the new way of faster payment processing.
For example, a consumer needs funds fast. Looking for the quickest and easiest approval process, they may look to a company like Mogo. With real-time payments integration, the consumer has access to funds in less than an hour. From start to finish. This is a game-changer.
Who benefits from RTPs?
Each and every one of us. Financial institutions (FIs), merchants, consumers and society as a whole will see significant wins.
Merchants using RTP will have better cash management in their day-to-day operations. Expect to see an improvement in cash on hand and an increase in revenue—no more waiting for days, weeks, or even payments. Get paid on time in real-time. RTP offers greater transparency, improved payments reconciliation, reduced unauthorized payments, reduced reliance on cards, and overall customer satisfaction. Just to name a few.
RTP creates an innovative platform for financial institutions (FIs) and payment service providers. According to a recent Deloitte report, faster payments change the payment landscape. Both FI's and payment service providers look to RTP to improve their competitive advantage and deliver value to customers.
Research finds consumers are embracing the convenience of digital payments. Technology has enhanced our lives and continues to make things simple and instant. Consumers want quick and convenient options, whether it is an instant book on Airbnb or on-demand Uber. RTP provides consumers with a simple and secure option to pay and get paid. 24/7 365 days a year, forget waiting for cash, cheque, or wire transfers; real-time payments are the way to go.
In 2020, 130 US Financial institutes moved to implement RTPs, an increase fivefold from the previous year
56 countries had a live RTP rail up from 14 only six years ago
India holds the largest RTP market by volume at 41 million payments per day
RTP in the Philippines grew 482% and Bahrain by 657% - noted the highest annual percentage value growth worldwide
50% of demand deposits in the US The Clearing House's RTP network connects 50% of the demand deposits in the US
Real-time payments are the future
According to a recent article PYMNTS article, Elena Whisler, senior vice president at The Clearing House (TCH) says real-time payments volume will soar in the new year and beyond.
Arbabi stated his confidence in RTPs and the expected gains they bring.
"RTP will boost innovation across industries, increase revenue and meet the universal demand for faster payments. Supply chain management can expect to see a dramatic change with real-time payments.”
Hamed Arbabi, VoPay CEO
RTP is an exciting space. Enterprises are looking at new and various use cases. Daily industry developments continue to push the drive for real-time payment modernization.
The evolution of real-time capabilities worldwide signals this is no longer a nice-to-have; it has become a top priority.
Real-time payments Canada
It is important to note that Canada has some significant ground to cover in catching up to the rest of the world regarding RTP. Implementing RTP's has not taken hold yet in our country. In our next real-time payment series, we take an in-depth look at why this is and the reasons behind it.
VoPay and RTPs
While the Canadian landscape has yet to see the full impact of embedded RTP in our payment processing VoPay is already leading the way. Understanding the importance of integrating RTP’s into businesses, VoPay offers Interac e-Transfer® for Business.
Send thousands of real-time payments with just an email using the VoPay API or payment portal.
Offer the fastest, most cost-efficient real-time payments option. RTP's=money now.
It's as easy as 1,2,3.
Contact VoPay today to explore real-time payment options.
