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Adoption of Real-Time Payment Solutions Accelerates Worldwide

By Bill Camarda

Real-time payment solutions are gaining momentum worldwide, as many national systems come online, still more move into development, and existing systems are handling growing payment volumes.

Real-time payment solutions have been defined in a variety of ways, but are generally considered to be systems in which one individual or company can irrevocably transfer funds to another's account at another financial institution, and receive confirmation, all in seconds, rather than minutes, hours, or days.1


According to an FIS report released late in 2017, 25 real-time payment solutions are now live, up from 14 in 2014. Eleven more systems were listed as under development, including payment services in Belgium, Canada, France, Hong Kong, Hungary, Italy, Latvia, the Netherlands, and the U.S. Several more were described as "on the radar," including systems in New Zealand, Malaysia, Norway, Slovakia, Saudi Arabia, The Philippines, and Vietnam.2


Australia Goes Live; Hong Kong to Follow Soon


Australia's New Payments Platform (NPP) solution went live to the public on February 13, 2018. According to the platform's developers, more than 60 Australian banks, building societies, and credit unions were expected to quickly roll out real-time data-enhanced payment solutions built on NPP.3


Hong Kong's system is expected to launch in September 2018, initially linking banks and major payment agencies to offer real-time payment services and settlements in both the Hong Kong dollar and the Chinese yuan.4 The Hong Kong Monetary Authority (HKMA), which supervises Hong Kong's financial system, describes its Faster Payments System as a key element of a fintech-driven overhaul it calls Smart Banking. To accelerate adoption by consumers using mobile devices at retail, HKMA is also pursuing a common QR code standard for supporting immediate payments using different payment solutions apps.5


Europe-wide Instant Payment Solutions Begin Rolling Out


By late 2017, real-time payment solutions were already available in much of Europe, including Denmark, Finland, Iceland, Poland, Sweden, and Switzerland. Meanwhile, the U.K.'s pioneering Faster Payments system was already celebrating a full decade serving customers, with plans to renew its infrastructure to support continued rapid growth.6 In 2017, the total number of U.K. real-time payments grew by 16 percent, and the value of real-time payments made in February 2018 was 24 percent higher than February 2017.7


Meanwhile, in November 2017, Europe's SEPA Instant Credit Transfer (SCT Inst) real-time, cross-border payments solution formally launched, with support from almost 600 payment service providers (PSPs) in Austria, Estonia, Germany, Italy, Latvia, Lithuania, the Netherlands and Spain. At launch, SCT Inst permitted transfers of up to 15,000 euros within 10 seconds, on a 24x7x365 basis, and counterparties were permitted to increase both speed and transaction limits if they chose.8


Eventually, SCT Inst is expected to encompass 34 countries, with payment solutions providers in Belgium, Finland, Germany, Malta, the Netherlands, Portugal and Sweden expected to join throughout 2018-2019.9 Some European nations that already have a domestic faster payments system, such as Sweden, are expected to join SCT Inst, in part for its cross-border capabilities, according to the European Central Bank.10


Outside the EU region, the Czech central bank and leading retail banks recently announced their intention to test a faster payments platform solution in mid-2018; they plan to make it publicly available by the end of the year with payment limits set at 400,000 Czech crowns (nearly $20,000). A poll found that roughly half of Czechs were likely to use the system if costs are kept low.11


Hungary's central bank is reportedly expected to launch 24x7 instant payments in the second half of 2019, with somewhat higher transaction limits.12 According to reports, while the system will only support the local Hungarian Forint (HUF), it will resemble Europe's SCT Inst in many other respects.13


Faster Payments Solutions Move Forward in the Americas


Mexico's real-time payment solution, Sistema de Pagos Electrónicos Interbancarios (SPEI), began offering instant payments about fourteen years ago. Today SPEI allows 103 participating financial institutions to deliver real-time payments 24x7. Payment volumes grew by 41 percent a year from 2005-2017, while the average payment value dropped (reflecting wider use in day-to-day consumer transactions).14


Further north, Payments Canada plans to deliver its solution, Real-time Payment Rail (RTR), by the end of 2019.15 Like many newer instant payment systems, Canada will use the ISO 20022 global payment messaging standard, which offers the potential for simpler interoperability, including cross-border connections to the U.S. and beyond.16


In the U.S. – the world's largest payments market, according to McKinsey & Co.17 – the Federal Reserve has appointed a team to plan governance of a national faster payments solution, aiming to establish a governance framework in 2018 and make instant payments ubiquitous by 2020.18 Among the organizations participating in that effort are The Clearing House (TCH), which launched and started test-driving its new Real-Time Payments (RTP) system at the end of 2017.19


TCH, an association owned by large commercial banks, expects to evolve its RTP system incrementally, and hopes to make it pervasive even among smaller institutions. To that end, it recently established a committee of stakeholders from credit unions, community and mid-size banks, and trade associations, requesting input on RTP's rules, directions, and service offerings.20 TCH's RTP is unlikely to be the only true real-time system running in the U.S.



Real-time payments solutions are becoming increasingly pervasive, as established systems grow and evolve, new systems come online, and other large markets take important steps towards implementation.

Bill Camarda - The Author

The Author

Bill Camarda

Bill Camarda is a professional writer with more than 30 years’ experience focusing on business and technology. He is author or co-author of 19 books on information technology and has written for clients including American Express Private Bank, Ernst & Young, Financial Times Knowledge and IBM.


1. “Flavors of Fast 2017: A Trip Around the World of Immediate Payments,” FIS;
2. Ibid.
3. “The New Payments Platform Launches,” New Payments Platform;
4. “Hong Kong’s Faster Payment System to Initially Cover Local Currency and Yuan,” YiCai Global;
5. “A New Era of Smart Payments,” A New Era of Smart Banking;
6. “Interest Sought In Major Payments Infrastructure Competition,” Faster Payments;
7. “Statistics,” Faster Payments;
8. “Sepa instant payments goes live,” Finextra;
9. Ibid.
10. “Launch of the SEPA Instant Credit Transfer Scheme,” European Central Bank;
11. “Fast Payments Promise from Czech Banks,” Radio Praha in English;
12. “Hungary Marches Towards Instant Payments,” Icon Solutions;
13. Ibid.
14. “Q&A: Banco de Mexico’s Miguel Diaz on IP,” InstaPay;
15. “Canada’s real-time payment rail (RTR),” InstaPay;
16. Ibid.
17. “What Drives Payments,” McKinsey & Co.;
18. “The Fed On Finding A Clear Road To Getting Faster,” PYMNTS.COM;
19. “Real-Time Payments Successfully Gets Through Its First Test Drive,” PYMNTS.COM;
20. “The Clearing House Announces RTP Advisory Committee,” The Clearing House;

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