As if demand for 24/7/365 convenience wasn’t already climbing fast enough, the global pandemic sent it into outer space. Americans are demanding more ways they can safely and securely pay anyone, anywhere, at any time, and with near-immediate funds availability over archaic and slow batch processes. As a result, the U.S. Faster Payments Council (FPC) and its members are working to advance the faster payments ecosystem, driving the emerging faster payments infrastructure toward ubiquity, fostering a high-quality and secure user experience for all, and supporting the widespread use of faster payments.
FPC members use private-sector approaches to address issues that inhibit the adoption of faster payments and enable end-users to reach each other in ways as seamless and transparent as mobile texting. As a result, payments are evolving quickly to reduce friction and leverage speed. Currently, more than 60 percent of the over 5,000 U.S. banks are already connected to the RTP® network.
As the race toward more widespread RTP availability continues, more and bigger players are entering the fray, including some established and some new ones, such as Zelle®, Venmo, Visa Direct, MasterCard, the Federal Reserve’s FedNow (expected in 2023), The Clearing House’s RTP network and NACHA Same Day ACH.
Benefits Beyond Speed
While instant, 24/7 availability of payments made possible by faster payments initiatives is a huge benefit in terms of managing cash flow, the ultimate advantage may lie in the power of unlocking transactional information. Coupling payment details with transactional data reveals insights to create operational efficiencies, enhance customer engagement and satisfaction, improve data transparency and accuracy, monitor fraud, manage risk, and streamline reconciliation processes.
Bill payments have been identified as one of four use cases that could benefit the most from faster payments. What does this mean for you and your business? Companies offering their customers the payment technologies, such as RfP, that employ faster payments are poised to greatly benefit.
To offer a truly modern payment experience, make sure you offer a wide variety of payment channels and methods. Consider implementing mobile, web, SMS, chatbot, and e-invoicing channels to enhance how you reach customers or members digitally to request payments and entice them to pay faster. Also, ramp up payment acceptance options to include faster payment services like credit, debit, same-day ACH, RTP, and more so that they are more likely to pay when you send requests.
Your business stands to benefit greatly by taking advantage of faster payments. Make sure you’re implementing the latest and greatest payment channels and methods to reap the advantages.
Read more about how faster payments can benefit billers in 5 Request for Pay (RfP) Use Cases for Billers.
Updated from a blog originally published April 2, 2020.
Alacriti’s centralized payment platform, Cosmos, provides innovation opportunities and the ability to make smart routing decisions at the financial institution to meet their individual needs. Financial institutions can take full ownership of their payments and control their evolution with ACH, Wire, TCH RTP® network, Visa Direct, and the FedNowSM Service, all on one cloud-based platform. To speak with an Alacriti payments expert, please contact us at (908) 791-2916 or info@alacriti.com.
