The Slow Crawl to Real-Time Payments

The United States lags other countries in enabling real-time payments to be made at a cost that encourages development of mass-market initiatives. However, a recent publication from the Federal Reserve presents a call to action for revamping or rebuilding the U.S. payments ecosystem to deliver a world-class real-time payment network. This would provide myriad benefits to financial institutions (FIs), consumers, businesses, and the U.S. government. However, this initiative might not reach fruition until the next decade, leaving the door wide open for a variety of third parties to enter the fray. Who will win the slow race to fast payments?

Primary Questions:

• What are “real-time” payments?
• How do real-time payments benefit consumers, merchants, FIs, and governments?
• What are the key initiatives for real-time payments in the U.S.?
• When are we likely to see real-time payments widespread?

Companies Mentioned: ACI Worldwide, Dwolla, FIS, Fiserv, NACHA, PayPal, Ripple Labs, Square, The Clearing House

The report uses data collected through a variety of consumer and merchant surveys:

• An online survey conducted in November 2013 of a random‐sample panel of 3,509 consumers
• An online survey conducted in October 2013 by Javelin from a random‐sample panel of 3,213 consumers
• The consumer data in this report is also derived from information collected online from 8,552 consumers, in November 2014 from Javelin‐Greenwich Associates Retail Banking Customer Segmentation
• Further primary research was conducted through telephone and email interviews and communication with vendors offering real-time payment capabilities