RTP Picks Up Pace With Corporates, While CBDCs Raise Banker Doubts

The Clearing House’s real-time payments offering, the RTP® network, continues to gather steam with financial institutions (FIs), FinTechs and their business customers in this week’s Payment Rail Innovation roundup. Plus, new concerns mount in Sweden over the rise of Central Bank Digital Currencies and their implications for the traditional banking system.

Wells River Savings Bank Joins The RTP Network

Wells River Savings Bank is looping into The Clearing House‘s RTP® network, with SHAZAM facilitating the integration, the companies announced this week. The bank, based in Vermont, said the adoption of RTP is part of its commitment to connect its business and consumer clients to “the most modern payments infrastructure in the world,” with the adoption allowing corporates and individuals to access funds sent from around the world in near real time.

“Our customers need financial technology tools that align with their personal and business needs,” Wells River Savings Bank Chief Financial Officer and Chief Operations Officers Judy Lavely said in the announcement. “Providing real-time payments is an important step for us, allowing us to deliver important new functionality to our customers, thereby improving their customer experience.”

Modern Treasury Raises Funding To Accelerate B2B Payments

With $38 million in fresh funding, accounts payable (AP) solution provider Modern Treasury is looking to further accelerate B2B payments. Noting that more than $18.5 trillion in B2B transactions in the U.S. are sent via wire, check and ACH, Modern Treasury said the industry continues to be plagued by sluggish transaction times that take days to clear. In its announcement of the funding, Modern Treasury said that its technology replaces legacy systems to integrate corporates with their banks via application programming interface (API) to facilitate real-time payments.

“One way companies are embracing payment innovation is with RTP, the first new payment system in 40 years,” the company said, citing the real-time payments network operated by The Clearing House. “RTP already accounts for more than 6 percent of Modern Treasury volume.”

Pakistan Preps Instant Payment System

Pakistan is next on the docket to develop and deploy an instant payments network. The country is developing its Raast system, which will be rolled out in phases by early next year, according to the State Bank of Pakistan. The new infrastructure aims to broaden financial inclusion, digitization transactions, and bolster government revenue.

The Raast system was developed in collaboration between the State Bank of Pakistan and the Bill & Melinda Gates Foundation, and it would be the first in the country to integrate government entities and FIs. The technology will facilitate instant payments for merchants, businesses, FinTechs, government entities and individuals.

Sweden Considers Implications Of Digital Currency

Banks across Sweden are growing more concerned about the implications of the nation’s new digital currency, the eKrona, with Reuters reporting that bankers are worried the tool will alter the banking system.

The country is currently in the development phase of the central bank digital currency (CBDC), with the report noting that Sweden is set to decide by November 2022 whether to pursue the technology. Banks are raising concerns that adoption of the eKrona could lead to mass withdrawals of funds in deposit accounts.

“This would potentially deprive banks of funding and leave them reliant on wholesale markets for liquidity,” the publication explained.