Finance:Instant payment

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Short description: Method of exchanging money and processing payments


Instant payment (sometimes referred to as real-time payment or faster payment) is a method of electronic funds transfer, allowing for almost immediate transfer of money between bank accounts. This was in contrast of the previous transfer times of one to three business days that had been in place until the mid 2010s.[1]

Since the mid 2010s many countries have implemented instant payment systems that speed up the transfer between bank accounts in response to customer demand for faster transactions.[1]

The Euro Retail Payments Board (ERPB) in 2018 defined instant payments as:

Electronic retail payment solutions available 24/7/365 and resulting in the immediate or close-to-immediate interbank clearing of the transaction and crediting of the payee’s account with confirmation to the payer (within seconds of payment initiation).[2]

History

Originally clearing of payments was based on the cheque clearing cycle that required physical cheques to exchanged by banks at clearing houses for payments to be made between bank accounts. When electronic payments entered the banking systems from the 1970s onwards, the same timeframes and processes were used to settle these electronic payments.

The growth of e-commerce since the 2000s has caused a change in people's spending patterns and expectations. Shopping is no longer confined to regular business hours, creating new challenges for funds transfers.[3] Similarly, merchants require faster and more reliable money transfer systems to keep up with consumers' demands.[4]

Traditional electronic payments like bank transfers, that perform the electronic funds transfers within few business days, are not in line with user expectations.[5][6]

By country

Country System
 Australia NPP - New Payments Platform,[7] available from February 2018
 Brazil Pix, released in October 2020 and available since November 2020
 China IBPS - Internet banking payment system, implemented in 2010[8]
 Denmark MobilePay, since 2013
 Europe RT1, available from November 2017 and
TIPS - TARGET Instant Payments Settlement, available from November 2018[9]
 Finland MobilePay, since 2013
 Hong Kong Faster Payment System - available since 2018
 Hungary GIROInstant - available since 2020 [10]
 India IMPS - Immediate Payment Service, implemented in 2010 and
UPI - Unified Payments Interface, implemented in 2016
 Japan ZENGIN, implemented in 1973
 Jordan CliQ, implemented in 2020 [11]
 Norway Vipps, since 2015.
 New Zealand Payments NZ, Real-time payments system, available from 2024.[12]
 Pakistan Raast since 2019
 Philippines GCash since 2013
 Poland Blik since 2015
 Singapore Fast and Secure Transfers (FAST)[13] since 2014
 Russia Sistema bystrykh platezhey (ru) - Fast Payments System,[14] from 2019
 Spain Bizum,[15] since 2017
 Sweden Swish,[16][17] since 2012, retail since 2014
  Switzerland Twint,[18] since 2017
 Thailand PromptPay, which is operated by VocaLink[19]
 United Kingdom Faster Payments Service (FPS), available since 2008, which is operated by VocaLink
 United States Zelle,[20] available since 2016 and
Venmo,[21] available since 2013 and
The Clearing House's RTP - Real-Time Payments,[22] available since 2017 and
FedNow, launched in mid-2023[23]

See also

References

  1. ↑ 1.0 1.1 "Are instant payments becoming the new normal? A comparative study". https://www.ecb.europa.eu/pub/pdf/scpops/ecb.op229~4c5ec8f02a.en.pdf. 
  2. ↑ "Instant payments definition". European Central Bank. 2017. https://www.ecb.europa.eu/paym/retpaym/instant/html/index.en.html. 
  3. ↑ "Digital transformation of the retail payments ecosystem". Banca d'Italia. November 30, 2017. p. 3. https://www.bancaditalia.it/pubblicazioni/interventi-governatore/integov2017/Visco_30112017.pdf. 
  4. ↑ "What are instant payments?". InstaPay. 2018. https://www.instapay.today/instant-payments/. 
  5. ↑ PYMNTS (2019-01-01). "2019: The Year Of Instant Payments" (in en-US). https://www.pymnts.com/news/payment-methods/2019/instant-faster-disbursements-gig-economy/. 
  6. ↑ "Instant payments are the future - here's why". Nordea. 2018. https://insights.nordea.com/instant-payments-are-future-heres-why. 
  7. ↑ "The New Payments Platform", Reserve Bank of Australia, https://www.rba.gov.au/payments-and-infrastructure/new-payments-platform/, retrieved 2021-09-21 
  8. ↑ "Payment, clearing and settlement systems in China", Bis.org, 2010, https://www.bis.org/cpmi/publ/d105_cn.pdf, retrieved 2021-09-21 
  9. ↑ "TARGET Instant Payments Settlement (TIPS)", Ecb.europa.eu/paym/groups/shared/docs/d8dd9-ami-pay-_20170209_item07b_presentation_on_tips.pdf, February 9, 2017, https://www.ecb.europa.eu/paym/groups/shared/docs/d8dd9-ami-pay-_20170209_item07b_presentation_on_tips.pdf, retrieved 2021-09-21 
  10. ↑ "Instant Payments" (in EN). https://www.mnb.hu/en/payments/instantpayments/. 
  11. ↑ "CliQ – Instant Payment System - JoPACC" (in EN). https://www.jopacc.com/EN/Pages/CliQ_–_Instant_Payment_System. 
  12. ↑ "The RBNZ wants a timetable as Payments NZ starts design work on a real-time payments system". Interest.co.nz. July 27, 2023. https://www.interest.co.nz/personal-finance/123252/rbnz-wants-timetable-payments-nz-starts-design-work-real-time-payments. 
  13. ↑ "FAST". https://www.abs.org.sg/consumer-banking/fast. 
  14. ↑ "В России запустили систему быстрых платежей", Российская газета, 2019-01-28, https://rg.ru/2019/01/28/v-rossii-zapustili-sistemu-bystryh-platezhej.html, retrieved 2019-01-28 
  15. ↑ "Bizum". https://bizum.es/en/. 
  16. ↑ "Swish - Betala enklare" (in sv-SE). https://www.getswish.se/om-swish/. 
  17. ↑ "Swish". Nationalencyklopedin. 
  18. ↑ "Simply Twint it". https://www.twint.ch/en/. 
  19. ↑ "Transforming Thailand to a digital economy". https://b2b.mastercard.com/stories/thailand-promptpay/. 
  20. ↑ "Zelle, the Banks' Answer to Venmo, Proves Vulnerable to Fraud", April 22, 2018, The New York Times , retrieved February 10, 2020
  21. ↑ "Venmo Revenue and Usage Statistics (2021)", Business of Apps, 2020-09-02, https://www.businessofapps.com/data/venmo-statistics/, retrieved 2020-09-02 
  22. ↑ "Real Time Payments", Theclearinghouse.org, https://www.theclearinghouse.org/payment-systems/~/link.aspx?_id=E184253EB0CE475E8D485D9FCCBB05E4&_z=z, retrieved 2021-09-21 
  23. ↑ "Federal Reserve Board - FedNow Service" (in en). https://www.federalreserve.gov/paymentsystems/fednow_about.htm. 



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