The world seemed to turn upside down last year. Teams shifted to working from home virtually overnight and everything from workflows to meetings became fully digital. This sudden shift in how we do business also increased the need for quick and frictionless ways to move money electronically. But, when it comes to payments, the industry has been slow to keep up with the pace of digital transformation.
Since the onset of the pandemic, the market has grown and adapted to the changing landscape, with digital payments quickly emerging as the preferred payment method for businesses and consumers. In fact, 77% of business leaders agree that digital currency will play a vital role in the future. Yet, even with the introduction of same-day ACH and push-to-debit, there’s never been a cost-effective way for businesses to move money in real time. Cash exchanges have always been the most immediate method for instant transactions — until real-time payments.
With the launch of The Clearing House’s RTP® Network, eligible financial institutions have the ability to clear and settle payments within seconds, providing businesses with a way to transfer funds faster than ever before. As a result, nine out of 10 businesseshave said they would like to adopt real-time payments as a digital solution. If you haven’t already adopted real-time payments, here is information why you should consider it as a future option.
Stand Out Against Competition
Nearly every industry can benefit from implementing real-time payments. Insurance providers can use them for faster payouts to their policyholders while real estate firms can streamline escrow or down payments for homeowners and buyers. In the B2B space especially, real-time payments allow companies to optimize cash flow, enhance customer relationships and reduce the time spent on payment processing for customers and vendors. Yet, as real-time payments gain traction among businesses — 81% of leaders expecting it to dramatically change the way business is done — they won’t simply replace other payment modalities. Instead, real-time payments give businesses an advantage over their competition by offering the flexibility of multiple payment methods.
Improve the Customer Experience
When the pandemic accelerated the move to digital payments, businesses quickly turned to contactless solutions to move money. With real-time payments, there is no “pending” status on money transfers because they don’t have to wait for the bank to open. Businesses can send and receive payments 24-hours a day, 365 days a year. Real-time payments are an always-on modality that allows companies to deliver value through more convenient payments and timing. Moreover, real-time payments give businesses the ability to make payments in time-sensitive or emergency situations, while enabling customers to better manage their money.
Protect Your Data, and Your Money
In today’s digital world, there’s always the risk of bad actors finding ways to defraud businesses, especially when it comes to payments. In fact, this time last year, cyber attacks on the financial industry increased 238%. When considering real-time payments, which add a new level of complexity because they settle within seconds, it’s important that businesses prepare to address this type of fraudulent behavior. By implementing new security measures for risk management, like regularly testing and assessing security measures, adding multi-factor authentication and data encryption, businesses can combat potential threats and ensure their data — and money — are protected long term.
Real-time payments are quickly becoming a must-have in the payments space, with companies seeking safe, fast and efficient ways for moving money. With demand increasing every day, businesses will be forced to adopt the new standard or risk losing customers. As it continues to shake up the payments space, business leaders should make the case now and start unlocking the many benefits of real-time payments.