Real-time payments, or the immediate transfer of money between bank accounts, are becoming a popular topic in the B2B world. However, there are still a lot of details to address before this becomes the norm for most business owners.
Real-time payments made their debut as a legitimate way to transfer funds with peer-to-peer apps like Venmo and Zelle. Zelle allows users to make money transfers instantly, while Venmo requires one to three business days unless the user pays a 1.5% transaction fee.
More than 83 million people in the U.S. currently use the Venmo app to share payments. For Zelle, user behavior has increased by 49% in 2021, and payments totaled $490 billion, up 59% from the previous year, according to this article from Forbes. Here’s what business owners in the B2B space need to know about real-time payments:
Reduce Friction
Real-time payments help reduce friction in payment processing because funds are sent and liquidated instantly.
However, some business owners may have differing opinions of what “real time” means. With this type of software, it appears to customers that transactions clear immediately, when in reality, the majority of the transactions are same-day or next-day ACH payments, according to PYMNTS. However, this type of software does eliminate some of the roadblocks that keep payments from transferring for weeks at a time.
Appeal to Customer
Customers are sometimes impatient and want to know that their payment went through right away through the quickest platform possible. When using P2P payments, they can send funds directly from their smartphone, instead of having to log onto an online portal or write out a paper check.
Plus, customers are generally satisfied with P2P payments and believe this evolving technology to be the way of the future.
More Selection
The average consumer enjoys payment freedom and a wide selection of services at their disposal. When using P2P payments, consumers can choose from Apple Pay, Venmo, Zelle Cash App and more.
Some consumers rank Apple Pay as the best P2P payment service due to its two-factor authentication, but others prefer Venmo or Zelle. Businesses can provide consumers with a selection without having to worry about tax documentation because most P2P software already has those details available within the app.
If you want to learn more about real-time payments or are seeking expert advice on how to drive payment processing costs down, get in touch with me today by calling 617-843-5700 or visiting my website. I look forward to working with you and developing the right payment processing strategy for your business.
