Business Payments Push The Clearing House and RTP® to Faster Payments Tipping Point

Eight years after launching the RTP® instant payments network, The Clearing House logged a stellar 2024. Early Wednesday (Jan. 8), the consortium announced that more than $246 billion moved over the RTP network in 2024, up 94% from 2023. Transaction volume was up 38% to 343 million. As many as 285,000 businesses are using the RTP network each month for business-to-business (B2B) transactions.

Jim Colassano, senior vice president, RTP Business Product Management at The Clearing House, said the ability to send money instantly, 24/7/365 has been gaining wide embrace across a variety of use cases — and users, too.

“The feedback that we get, not only from consumers, but also from the business community, is that when you see it,” he said of instant payments, “when you actually experience it, both from an origination standpoint and from a receiving standpoint, you want to do more, you want this to be the payment mechanism that you would like to use.”

Double-Digit Volume and Value Growth

It’s been a slow burn since 2017, Colassano added. The metrics on volume and total payments value crossing the network “both tell very important stories,” he told PYMNTS. “We are a retail payment network, so transaction volume matters, and it means that consumers by and large are starting to adopt and use real-time payments and instant payments. And that’s an extremely good indicator of where we’re going and what the growth is going to be.”

As evidenced by the average transaction values, he said, there’s another important leg to the story: Businesses are shifting their own payments onto the network, even though B2B payments are still dominated by paper checks.

Colassano noted that the increase in B2B payments helped push average transaction values 40% higher, to $719 in 2024, up from $514 in the previous year.

“There’s that immediate gratification of knowing that the payment’s actually been received by the person that you send it to,” Colassano said.

At the moment, said Colassano, the RTP network has significant reach — covering 70% of households in the United States, and that in turn gets more businesses to bring more volume to the network as well.

“The buoyancy in transaction volumes is really an indicator of repeat payments, of more activity coming in,” Colassano said, “and it builds upon itself, because success has a tendency of building on itself.” There’s been some additional tailwind, said Colassano, from the fact that FedNow launched last year, raising awareness of instant payments what Colassano termed “the public square. In addition to the marketing and the success that we’ve already established, it’s also helped to reinforce the message that RTP and real-time payments are here to stay,” he said.

The Evolution of Use Cases

Asked by PYMNTS about how use cases have evolves across the consumer and business spheres, Colassano said for consumers, “for gig workers who wanted to get paid at the end of shift, the ability to get payout using RTP anytime of the day or night or weekends after they ended their shift, was a real value proposition for them. And we’ve since seen that start to evolve toward more traditional payrolls.” That means non-gig-worker employees have been gaining earlier access to their funds than a traditional pay cycle will allow.

“We’re also starting to see more activity where money is moving from closed loop networks,” said Colassano, “to a bank account where you’ve got more utility out of that money … [and] moving out of digital wallets that can only be used for limited purposes. We are also seeing a lot of activity and also the gaming space where folks are defunding their gaming wallets and … their winnings moving into their bank accounts.”

On the business side of the equation, said Colassano, firms large and small are using RTP to manage cash flow and to use instant payments for cash concentration between accounts that they own at different banks or for merchant funding.

“We are seeing a lot of apps that are evolving in the FinTech space are also starting to leverage real-time payments simply because of the fact that they operate 24/7,” he said.

Looking ahead, Colassano said the recent move to increase transaction limits to $10 million should help drive more B2B traffic. Asked about security concerns, he said that especially for B2B transactions “there are several protocols in place to make sure that higher value transactions have a good number of controls on them.” Consumer-initiated payments, he said, also are seeing increased security through prompts that educate them that the transactions are irrevocable and ask for confirmation that they indeed want to move ahead with the transaction.

“The message I want to bring to everybody,” he told PYMNTS, “is that instant payments are growing and expanding. We see more use cases on the network every single day … we have reached a tipping point and we are going into 2025 absolutely confident that we are going to start to see an even greater explosion of real-time payments on the network than we saw in 2024.”