KeyBank: Banks Must Master Real-Time Payments to Satisfy Digital-First Consumers

The pandemic has changed consumers’ preferences for how they pay vendors and receive disbursements that range from paychecks to insurance payouts. Contactless payments’ growing popularity helped consumers discover how easy it could be to make purchases, pay bills, receive their paychecks and exchange money with family and friends at the tap of a button.

This digital development has occurred in tandem with the growth of real-time payment capabilities, freeing consumers from having to waiting for manual payments, such as paper checks, to settle in their accounts. Customers have grown to appreciate the convenience and safety of real-time payments, and more financial institutions (FIs) are seizing the opportunity to provide these payments and educate consumers on the benefits they offer.

In the December edition of the Real-Time Payments Tracker®, PYMNTS explores the increasing use of real-time payments, as well as the trends and demographics driving its fast growth.

Around the Real-Time Payments Space

Consumers report that they are largely satisfied with the mobile-focused, real-time payment innovations their FIs are offering. A recent report from the American Bankers Association (ABA) found that 99% of banking customers believe their banks’ mobile and digital services are “good,” “very good” or “excellent,” with many pointing to FIs’ mobile and digital capabilities as being particularly satisfying. More than half of banking customers said that they utilize digital devices like smartphones to make payments or transfer money. The use of mobile payment apps that offer real-time payments functionality, such as Venmo and Zelle, are also growing in popularity.

Real-time payments are also on the rise in the corporate world, with a new report suggesting that these transactions will account for up to half of all business-to-business (B2B) payments globally by 2025. The number of real-time transactions worldwide rose 41% in 2020, buoyed by digital wallet use and growth in the eCommerce sector. Singapore saw the most significant increase in real-time transactions at 58%, while the United Kingdom saw modest year-over-year growth of 17%. Fifty-six nations now have real-time payments systems, four times the number of those who did in 2015.

For more on these stories, visit the Tracker’s News and Trends section.

KeyBank on How Real-Time Payments Are Changing the Financial Landscape

The pandemic gave consumers a taste of digital freedom and the benefits that come along with electronic and even real-time payment methods, and many value them in both their personal and professional lives. In this month’s Feature Story, Richard Booth, senior product manager of real-time payments and core payable check products for KeyBank Enterprise Payments, explains how real-time payments’ rising popularity will require FIs to adapt to consumers’ shifting demands and offer financial products that provide flexibility and speed.

PYMNTS Intelligence: How Consumers Are Driving Demand for Real-Time Payments

A recent report found that the global market value of real-time payments reached $10.6 billion in 2020, and it is expected to grow at a compound annual growth rate (CAGR) of about 33% from 2021 to 2028. These statistics offer a glimpse into the growing popularity of real-time payments and the power of consumer demand for the technology.

This month’s PYMNTS Intelligence examines how real-time payments make money transfers safer and faster and how certain demographic groups are leading the real-time payments charge into the future.

About the Tracker

The Real-Time Payments Tracker®, a PYMNTS and The Clearing House collaboration, examines how the mad dash to digitize payments during the pandemic has led to greater consumer demand for options to pay for purchases and to receive paychecks and insurance payouts in real time.