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Education

are transferred to payee accounts within seconds, and office operations to accommodate the full order handling
positions are immediately known and available for capabilities offered by RTP.
research and reporting after individual transactions arrive
at the back office. Key considerations
Can real-time payments provide real value to financial
Operationally, FIs and businesses tend to adopt subsets of institutions, processors, businesses and individuals?
real-time processing using a staged approach. For example, Definitely. Do organizations need to be careful in their
FedNow will permit participating FIs to implement adoption of real-time payments capability? Absolutely. In
receipt of real-time payments without having to support the final analysis, different organizations will associate
origination of real-time payments. This eliminates the different risk/reward ratios to the adoption of real-time
necessity of monitoring reserves on hand on a 24x7x365 payments.
basis, which simplifies back-office banking operations.
Aggressive organizations will take pride in "leading the
Additionally, FedNow will permit third parties to be field" with new, innovative features; more conservative
FedNow participants. The expectation is that larger organizations will not adopt a new feature or capability
processing companies like FIS and Fiserv will offer unless their market demands it. In the former case,
24x7x365 back-office services for smaller FIs so they can organizations are setting a competitive marker; in the
support real-time payments with reduced disruption to latter, organizations are opting for potentially lower cost
daily operations. of operation and greater stability.

As noted, businesses frequently enter the real-time
payments world by adopting simpler, straightforward Dr. Jack T. Baldwin is chairman and CEO ofBHMI, a leading provider of
payment types like P2P or B2B payments. More aggressive product-based software solutions focused on the back office process-
organizations that want to eventually take advantage of ing of electronic payment transactions and creator of the Concourse
the complete order processing capabilities offered by RTP Financial Software Suite. For more information, please visit https://
are adopting elements of the order processing cycles on a www.bhmi.com/concourse-financial-software-suite.
staged basis as they gradually adapt their existing back-