Real-Time Payments Put Bank Infrastructure on the Clock

Real-time payments are giving banks another reason to confront technology they have spent years working around.

The PYMNTS Intelligence report “From Adoption to Execution: How FIs Are Turning Real-Time Payments Into Competitive Advantage” is the August edition of the “Real-Time Payments Tracker” and a collaboration with The Clearing House. It found that 76% of financial institutions already provide access to the RTP® network, while 92% of those that haven’t enabled RTP expect to do so within two years.

That makes the infrastructure required to operate real-time payments a more immediate issue.

The pressure isn’t simply about connecting to another payment rail. The report revealed that 53% of FIs pointed to manual-intensive internal processes as their biggest modernization obstacle, while 52% identified outdated technology, and 47% cited siloed payment systems.

Real-time payments must work with systems that handle liquidity, treasury operations, transaction routing and customer information. They also must operate around the clock. The report identified technology integration with core and treasury systems, implementation costs, liquidity requirements and staffing for 24/7 payments among the practical challenges FIs face.

The result could be a broader modernization cycle in which RTP adoption accelerates spending on the infrastructure surrounding the rail.

Payment hubs are one indication of where that money could go. The report showed that 35% of FIs are adding centralized third-party payment hubs, while 32% are adding rail-specific tools to their existing systems. Those investments can help FIs route transactions across multiple payment networks without requiring every rail to operate as a separate technology stack.

Core integration presents another challenge. An instant payment connection can move money in seconds, but the surrounding bank systems still need to recognize the transaction, update balances, and make information available to customers and internal operations. The report’s modernization findings suggested that fragmented infrastructure can make those connections harder to build and maintain.

Treasury infrastructure faces similar demands. Business customers value payment tracking and immediate confirmation, with 28% identifying each as a leading benefit of instant payments. The value of real-time payments therefore extends beyond transaction speed to the information and operational visibility accompanying the payment.

RTP Raises the Cost of Leaving Infrastructure Untouched

The spending case becomes stronger as adoption approaches the norm.

Among FIs that hadn’t yet enabled the RTP network, 92% expected to do so within two years, and 95% without the FedNow® Service expected to enable it over the same period. Meanwhile, 88% of FIs rated the return on investment from instant B2B payments as high or very high, including 82% of institutions that hadn’t yet enabled an instant payment rail.

The combination changes the modernization calculation. Banks can postpone infrastructure work when a new payment capability remains optional or lightly used. It becomes harder when customers expect real-time availability, and the FI must support the service continuously across treasury, operations and core systems.

Additionally, modernization won’t necessarily take the form of wholesale core replacement. According to the report, 43% of FIs characterized themselves as technology pragmatists that wait until technology becomes mainstream, while another 23% described themselves as conservatives that favor well-established solutions.

There’s an opening for investment around existing cores, including payment orchestration, integration layers, APIs, treasury connectivity and other infrastructure capable of connecting legacy systems with real-time rails.

With more than half of FIs already identifying legacy technology as a major obstacle and most RTP network holdouts expecting to connect within two years, the next wave of real-time payments hinges on upgrading the systems required to make that access work at scale.

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