We live in a world of instant gratification — and consumers want everything to work in real-time.
Yet until recently, real-time payments were anything but…
Now the real-time revolution in payments is finally here — and you need to know how to reap the rewards.
In a recent episode of Payments Innovation, we were joined by Matt Wilcox, President, Digital Payments and Data Aggregation at Fiserv. He answered all our burning questions about the real-time payments revolution.
We discussed topics like:
- Shifting consumer expectations around real-time payments
- The education component necessary for real-time
- The future of real-time payments
“Real-time used to mean ‘within minutes,’ but it’s increased to immediacy. And I think that’s just the instant-gratification world that we live in.” — Matt Wilcox
Real-time really means immediate
We live in a world of instant gratification. In case you needed proof of that…
Matt recently conducted a survey with his customers.
Survey question: What is your definition of real-time?
- Over 50% of them said “immediate” — meaning they expected the transaction to happen immediately.
- About 25% of them said, “within a few seconds.”
In other words, to customers…
real-time = right now
If I’m sending you money, you should be able to log in and see those funds before I’m done telling you they’re in progress.
Now, here’s another interesting stat — 44% of consumers actually believe that non-bank apps give you instant access to your money.
We know that’s not quite true, of course. Just because you hit a button marked “send” doesn’t mean the money is going to pop into your bank account right that instant. But that’s what folks believe.
How can we start to drive awareness around instant payments?
The answer lies in education.
“The onus falls on providers like us to give guidance and to educate the industry about real-time.” — Matt Wilcox
Becoming a guide for your customers
Matt was shopping at a store the other day, and some people were there soliciting donations for a charity. He suggested that they could accept payments using Square or PayPal or even this thing called Zelle®.
They had never heard of Zelle.
“It’s this great thing,” Matt told them. “It’s with your bank, and the money’s in your account immediately, whereas the other ones might take a little bit of time.”
That’s a simple way to educate people.
Actually, the education piece of real-time payments has gotten better. Companies such as Fiserv are helping educate not only the financial institutions but the end customers as well. These companies are publishing content and doing in-branch training along with tutorials and webinars to try to give guidance around payments in one-on-one settings.
Real-time is an important educational component. It’s good for the end consumer to understand all of the various nuances around payments for three reasons:
- They can utilize the platforms that are best for them in their lives
- They can make sure they’re using the right ones for the right use cases
- They understand the risk and controls that financial institutions put in place on their behalf.
The onus falls on providers like us to give guidance and to educate the industry.
“There’s beauty in lots of options. But there’s also complexity in lots of options.” — Matt Wilcox
Meeting shifting customer expectations
A lot of what consumers’ expectations are driving leads into their own businesses, especially for B2B. Putting effort into that building phase up front really pays off in the end.
That’s the point — pick a partner that’s going to be there through their journey.
There’s beauty in lots of options, but there’s also complexity in lots of options. You need to make sure you’re thinking about the long game because there’s another Fed Now, there’s another RTP, somewhere out there.
As we start to think about connecting US domestic networks to global networks, we have to be thinking about international transfers as well. Not long from now, consumers are going to be knocking on the doors of financial institutions saying, Hey, I, I love my transfers. And I love that they’re in real-time. And I love that I can move it from one institution to the next in real-time. But I really would love to move it from Wisconsin to an institution in London. Can you help me do that?
Oh, by the way, even though the money is going across the pond, these consumers will still expect the transfer to happen in real-time.
The onus is on folks like Fiserv and others to work in collaboration with financial institutions to figure that out.
Again, there’s beauty in the options. But there’s a lot of planning and thinking that needs to happen too.
Matt’s big concern is not freezing the progress in the market. He doesn’t want financial institutions to think they should sit and wait for a winner to be declared.
There’s gonna be a lot of winners.
Until next time!
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