The number of faster payment options continues to proliferate — particularly for consumer use cases — but the RTP® network from The Clearing House is the only one of these options in the United States currently offering true real-time payments, where transactions are settled with two-way messaging at any hour of any day. All but 24 of the 251 financial institutions (FIs) participating in the RTP network are enabled by a third party, whether that is a technology provider, funding agent or a third party providing a combination of both.
In this edition of the Real-Time Payments Tracker®, PYMNTS takes a closer look at the ecosystem of third parties that help support and facilitate the RTP network and offers information for potential participant FIs and businesses to consider when looking to enable true real-time payments.
Around the Real-Time Payments Space
In a survey of professionals from U.S. banks and credit unions with assets between $2 billion and $25 billion, 27% of respondents said their organizations are already connected to The Clearing House’s RTP network. This share is nearly double the percentage that gave the same response in 2021. In addition, that growth appears poised to continue, with 37% of those not connected to the RTP network saying they are committed to joining within the coming year, meaning that more than half of all FIs within that range are expected to be connected to the network in 2023.
As consumers and businesses seek faster payment rails, security and privacy are also significant priorities. With the addition of tokenization of deposit and checking account information to the RTP network and Electronic Payments Network, participants can ensure that the account information of a sender or receiver is not shared with any other party. Through Secure Token Exchange, a token is issued to function in the place of a customer’s bank account and routing information.
For more on these and other stories, check out the Tracker’s News and Trends section.
Placing Real-Time Payments Within Reach
FinTechs are looking to connect FIs and their customers with faster payment options as demand grows. These third-party organizations enable community banks, credit unions and other small or midsized FIs to offer competitive payment options by doing the heavy lifting in terms of technology, payment infrastructure and even liquidity management. Payrailz, which aims to help clients tap into a variety of payments rails, including the RTP network, and Jack Henry & Associates (JHA), which leverages an in-house payment system to help FIs access the network, are two such FinTechs.
PYMNTS Intelligence: The Role of Third-Party Organizations in Providing Real Real-Time Payments
The most recent information from The Clearing House indicates that 251 FIs can send and receive real-time payments through the RTP network, reaching 61% of U.S. direct deposit accounts (DDAs). At the same time, just 24 of those FIs are integrated directly into the RTP network. The rest participate through a third party, such as a third-party service provider (TPSP) or credit union service organization (CUSO). Many more FIs can receive real-time payments through such third parties, even though they are not participants in the network.
This month’s PYMNTS Intelligence takes a closer look at the RTP network ecosystem and the third-party organizations that help FIs provide their customers with true real-time payments.
About the Tracker
The Real-Time Payments Tracker®, a PYMNTS and The Clearing House collaboration, examines the latest trends and developments shaping the real-time payments space and the role of third-party service providers in making real-time payments possible for more FIs.