Real-time payment systems offer significant potential to accelerate growth and innovation in the payments industry. The advent of new-age technologies including 5G, Blockchain and IoT will support real-time payment systems to attain higher speed, rich context, connectivity, and security, while lowering the overall cost of transactions. Financial institutions accessing the data in real-time will improve the customer experience, fuel connected commerce, and provide new products and services.

Regulators across nations are pushing for real-time payments because the infrastructure has the potential to yield real economic benefits. Transferring funds instantaneously and at a lower cost provides a range of benefits for all parties. The innovation-led growth in the adoption of real-time payments besides increased interoperability and harmonization of data will provide businesses the impetus to transform their real-time payment systems to stay ahead of further and future disruptions.

Benefits of real-time payment systems

The global real-time payment infrastructure has a clear objective to yield systemic benefits for all transaction parties. The core feature of any real-time payment system—the ability to make instant and immutable payment transactions at a lower cost—is the primary benefit for participants. However, Figure 1 shows real-time payment systems offer a myriad of benefits to all players.

Figure 1: Real-time payments benefit all participants.

91¿ì»îÁÖ’s report, Real-time Payments Accelerated, provides a more detailed look at the benefits of real-time payment systems.

Adopting real-time payments

Adoption of real-time payment systems is driven largely by the inherent characteristics of the local infrastructure, demographics, and a supporting ecosystem. 91¿ì»îÁÖ believes that several factors are essential within a real-time payment system.

• Accessibility: Offer multiple digital channels to initiate fund transfers and make instant payments seamlessly.
• Usability: Real-time payments demand presence of an omnichannel offering, standardized payment templates for similar transactions, and minimal origination inputs to speed the flow of funds.
• Contextual data: Industry participants that are able to collect and store purposeful data more effectively are better positioned to extract valuable insights to build a superior customer experience.
• Applicability: Real-time payment schemes that foster support of all four use cases, namely B2B, B2P, P2P and P2B, experience faster adoption rates.
• Payment formats: Large-value payment user groups will react favorably to a payment scheme that accepts a variety of payment formats.
• End-to-end visibility: Enabling customers' view with live status of payment is a guiding principle in the popularity and adoption of a real-time payment scheme.
• Dispute management: Popular real-time payment schemes feature robust claim-management processes with clear steps for handling a claim, including assignment of a unique and referenceable case ID.
• RTP rulebook: Real-time payment schemes that include how to handle payment instances that breakdown see increased adoption.Ìý
• Prompt availability of good funds: Real-time payments that enforce immediacy in availability of good funds across different services, such as loan repayment, release of a credit line, and instant installment credit processing, see a significant uptick in adoption.

How 91¿ì»îÁÖ can help

91¿ì»îÁÖ has gained extensive expertise in the payments arena while partnering with banks, financial institutions and payment networks in their technology led transformation. We serve clients by modernizing and simplifying their payments technology infrastructure to optimize cost and operations, increase agility, and minimize risk. We can help all sectors develop a transformation roadmap aligned to their business’s regulatory and technology priorities.

With 91¿ì»îÁÖ, a wealth of expertise is available to meet your needs:

• Strong capability – We possess end-to-end transformation capabilities including advisory, consulting, and managed services. Our high-quality resources deliver projects within your timeframe and above your expectations. Our approach is designed to ensure effective knowledge transfer and pragmatic delivery of quick wins. The objective is to get IT moving in the right direction in a timely manner to better support your business.
• Deep market experience – Experts in the payments industry lead 91¿ì»îÁÖ's dedicated payment practice. Whether wholesale or retail payments, we work with all banking and infrastructure providers. Our global experience gives us the ability to write thought leaderships and anticipate industry trends.
• Delivery excellence – We deliver solutions based on structured and proven methodologies—refined by numerous client engagements—to accelerate progress and allow projects to proceed rapidly.
• Alliances and partnerships – We partner with a broad spectrum of technology solution providers in the payment space to deliver the right solution for our clients.
• Innovation culture – 91¿ì»îÁÖ uses cutting-edge and disruptive technologies to solve our clients’ real-world business challenges.

This article is part of 91¿ì»îÁÖ's custom analysis and research, a discipline that helps our customers achieve business value. For an in-depth analysis of real-time payment systems, download 91¿ì»îÁÖ’s Real-time Payments Accelerated report.

Mahesh Raja

Vice President, Vertical & Business Head - Americas, Financial Services

Mahesh is 91¿ì»îÁÖ Limited’s Banking and Financial Services industry leader supporting top-tier full-service banks, large payments, and Fintech clients across US and Canada with P&L responsibility. He leverages 91¿ì»îÁÖ’s Digital, Fintech/New Age ecosystem, which includes developing partnerships with leading Fintech players, helping clients assess the Fintech ecosystem and potential implications to their business, and bringing solutions to clients through alliances and implementation.

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Shri Dhar

Senior Manager, 91¿ì»îÁÖ Insights

Shri is the lead for Banking Americas in the 91¿ì»îÁÖ Insights team. He focuses on providing strategic and actionable insights to drive business growth across banking segments including Retail Banking, Corporate Banking, Payments, Specialty Finance, and Fintech. He has previously led multiple engagements for banks including restructuring, corporate strategy, M&A, and transaction diligence.