Faster and Real-Time Payments: New Players Primed to Overtake Legacy Solutions

In the past 18 to 24 months, the U.S. market has witnessed a revolution in improvement in delivering faster payments to both consumers and businesses. Dramatic examples include the launch and market success of Zelle, the bank-sponsored person-to-person (P2P) network service; the initial deployment of The Clearing House’s (TCH) Real-Time Payment (RTP) service; the expansion of Visa’s and Mastercard’s push payment services, which use their respective debit card networks; and implementation of the third phase of NACHA’s Same Day ACH service. Numerous other commercial deployments leverage many of the aforementioned technologies, benefiting consumers and small businesses. In the next two to three years, the financial services industry is expected to continue expanding the breadth and availability of these faster payment offerings. This report takes a closer look at some of the major faster payment initiatives and explores their potential opportunities for adoption as well as any potential barriers.

Key questions discussed in this report:

• How has Same Day ACH adoption fared since its introduction?
• What is NACHA proposing to do to drive greater adoption of Same Day ACH? 
• What is the main challenge to wider adoption of Same Day ACH?
• How successful are the card networks at driving adoption of the Original Credit Transaction (OCT) method as a means of promoting faster payments?
• What is the status of The Clearing House’s Real-Time Payments network?
• How interested are consumers in using real-time payments?

The consumer data in this report was primarily collected from the following:

Data on the industry participants were derived from interviews with industry leaders. Supplementary data were provided by secondary sources such as the Consumer Financial Protection Bureau (CFPB), the Federal Reserve Bank, the U.S. Treasury, and company websites.