The payment processing landscape is changing as more and more customers demand access to instant or real-time payment capabilities.
There are many advantages to real-time payments including improved cash flow management for both customers and businesses. Merely a decade ago, a customer would have had to wait three to four days after ordering services and goods for their payment to clear the bank. Since then, the industry has made big strides toward real-time payments – with many payment transfers completed in a matter of seconds.
Real-time payments became prevalent in the U.S. in late 2017 with the launch of the Real-Time Payments (RTP) network, which allowed federally insured financial institutions to clear financial transactions in real-time. The network allows businesses and consumers to send/receive payments 24/7, 365 days a year.
Consumers have grown accustomed to all transactions getting completed in real-time. Online Banking payments are faster as are third-party payment processors. Customers are using several channels to make real-time payments including smart phones, digital wallets, tablets, and other internet connected devices.
Real-time payments help both businesses and consumers with cash management. Days are no longer required for completing transactions, improving cash flow for businesses. Customers can know instantly about fund withdrawls from their bank accounts.
A report by VISA and the Aite Group found that real-time payments are predicted to drive digital payment growth in North America. The U.S. is moving away from paper-based payment methods with 74% of Americans surveyed saying they preferred electronic payments over checks. Another 16% of Americans preferred e-Transfer for receiving payments. As the prevalence of real-time payments increases, companies are seeking technologies that support real-time payment technologies.
Richmond Financial Services offers energy clients next generation payment strategies. Contact us to learn more about our payment processing solutions.
