The future is instant – why banks must prepare for global instant payments

A new white paper from global digital banking infrastructure leader RS2 claims instant payment schemes are going to dominate both domestic and cross-border transactions within a decade.

The paper also outlines what banks need to do to grasp the instant opportunity and protect themselves and their customers from emerging risks linked to instant payments.

Instant Payments, also known as Faster Payments, have seen stratospheric growth over the last decade of 29.1% year on year.

By 2029, it’s predicted they will account for a third of all consumer transactions globally.

RS2’s new paper details the attractions for consumers, businesses of all sizes and government organizations, from better household budget management through to improved cash flow and more dynamic investment opportunities.

The paper also shows how countries around the world, especially in high-growth Asian markets, are linking up their instant payment schemes to drive higher economic growth.

In April 2021, Singapore’s PayNow and Thailand’s PromptPay joined forces to offer instant payments across borders, while India’s Unified Payments Interface (UPI) has connected with Singapore’s PayNow and announced a partnership with Google to enable connectivity with other regions and markets world-wide.

Instant e-commerce – happening now

While e-commerce has hitherto been dominated by cards, digital wallets and invoicing payments, the research, entitled Why banks must prepare for an Instant future shows that the proportion of e-commerce transactions via instant payments is growing fast, and will account for one in three of all digital transactions in Europe by 2027.

RS2 explain that this rapid rise is creating specific risks for banks, including new fraud types such as Authorized Push Payment (APP) fraud, Account Takeover and Synthetic ID fraud.

“By 2027, one in three European digital transactions will be instant.”

Preparing for a future focused on real time will present several challenges for banks, from new fraud types and legacy infrastructure that’s not fit for purpose through to cash management, settlement and regulatory challenges.

The white paper explains what banks need to do to prepare, including reconfiguring their payments infrastructure to ensure continuous 24/7/365 settlement and interoperability with a huge range of instant payment schemes world-wide as the globalization of the economy continues into the 2030s.

Download a free copy the new white paper now for more on how the rise of global instant payments are going to impact the way banks do business in the 2030s.