This posting in Monitor Daily summarizes a recent survey about real-time payments conducted by Citizens Commercial Banking. The U.S.-based survey involved 252 corporate decision-makers and these summary results suggest that a vast majority of businesses are seeking the capabilities provided by RTP, which is the real-time payments network launched by The Clearing House (TCH) in late 2017. Mercator Advisory Group had covered progress in the space earlier this year in a member report as well as in a recent podcast with PaymentsJournal.
‘“I’m encouraged to see the level of interest in real-time payments because it offers such tremendous advantages to businesses in terms of speed and certainty of payments,” Matt Richardson, head of product solutions at Citizens, said….A bank’s ability to provide RTP was cited by survey respondents as the second-most important determining factor in choosing a banking partner, ranking right behind a bank’s ability to provide solutions throughout the business lifecycle. In fact, RTP solutions were ranked as a more important service than knowledge or expertise in the business’ industry or the lowest-cost financing.’
We have not seen the detailed results but the survey response concerning the level of importance assigned to RTP with regard to a banking relationship decision is perhaps the most surprising one in the summary. We do know that about 40 banks are now connected to RTP, either directly or through a 3rd party service provider, and that the network is reaching somewhere around 60-65% of U.S. demand deposit accounts. This is far from ubiquity, which TCH had announced would be attainable by end of year 2020. So the finding suggest that demand is in front of supply and many more banks should consider launching RTP capabilities.
‘“The pandemic has disrupted many businesses and exposed the downsides to relying on paper payments,” Richardson said. “We will continue to support omni-channel solutions and serve our clients however they need us, but the crisis has demonstrated how resilient and reliable digital payment methods can be and has prompted many businesses to redouble their efforts to digitize their payments.”…The survey sampled a range of businesses in different sectors with annual revenue of $1 million to $25 million (32%), $25 million to $100 million (18%) and more than $100 million (50%). It was conducted in June 2020.’
Earlier this year when we spoke with a number of the early bank adopters of RTP, the B2B use cases were lagging other use cases. Perhaps that will be changing soon.
Overview by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service at Mercator Advisory Group