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Co v er St o r y
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endpoints, Visa noted, including more than 3 billion cards,
In addition, the Fed surveyed over 2 billion accounts and 1.5 billion digital wallets.
consumers in 2021 and found Recent studies and reports illustrate consumer and
interest in faster payments extends business demand for faster payments is strong. "Instant

well beyond the person-to-person payments is on a consistent growth trajectory. Both
businesses and consumers are driving this growth," Wells
applications popularized by mobile Ulrike Guigui, head of enterprise payments strategy at
apps like Venmo and Zelle. Wells Fargo Bank, and Sumit Arora, marketplace leader
for enterprise payments strategy, wrote in a recent report.

In addition, the Fed surveyed consumers in 2021 and
to kill credit cards split the bank," read one headline. found interest in faster payments extends well beyond the
"Chase plans to end their $5 billion credit card business," person-to-person applications popularized by mobile apps
read another. like Venmo and Zelle. Nearly 80 percent of those surveyed
expressed interest in using faster payments services to
Not so, a Chase spokesman told The Green Sheet. He pay businesses. The most popular consumer-to-business
provided a press release that described pay-by-bank as applications included bill payments, online shopping and
another option for bill payments—one that frees billers in-person retail purchases, in that order, the Fed reported.
from having to retain and secure consumer banking
information. Separately, a Fed survey of businesses found nine out of
10 respondents expect to be ready to make and support
"Billers and consumers both get greater payment choice," faster payments, 24/7/365, within the next three years. The
Chiro Aikat, executive vice president, merchants and most popular use cases will include payroll, recurring
acceptance for Mastercard North America, said in the bill payments, internal transfers and routine payments. A
press release. survey by ACI Worldwide found better than half of U.S.
retailers (52 percent) accept or plan to accept real-time
Prakash Natarajan, managing director for payments payments in the next three years, typically via mobile P2P
strategy at the consultancy Strategic Resource apps.
Management, said the Chase-Mastercard solution should
have little impact on card payments. "Real-time payments Real-time payments can be open loop or closed loop. In
addresses a different set of use cases," he said. a closed loop scenario, senders and receivers must be
registered with the same network for payments to be truly
Keith Riddle, CEO at BankiFi, a business banking in real time. Apps like Venmo and CashApp are closed-
technology firm, agreed. "I don't anticipate an immediate loop payment networks. Funds are made available in real
impact on card volume," he said. "However, I do think time but only to accounts on the network. When a recipient
that you will see banks start to work with billers and wants to access their cash outside the app, another payment
merchants to advance frictionless payments." Once those rail, typically the ACH is needed to complete the transfer.
ramp up, there could be an impact, he suggested.
RTP is the only open loop, real-time payment network
Mastercard is no newcomer to the real-time payments operating at present in the United States. In November
discussion. In 2017 it purchased Vocalink, the UK company TCH reported that RTP's reach extends to 62 percent of
whose technology undergirds that country's real-time demand deposit accounts at 285 banks and credit unions
payments network as well as the RTP network here in the in the United States. Payment volumes have been rising
United States. by at least 10 percent per quarter, dating back to 2018,
TCH said. In the second quarter of 2022, RTP processed 45
Different iterations of faster million transactions valued at $19.7 billion.
Mastercard and Visa also support push-to-card payments, "The number-one use case we're seeing is account-to-
known as Mastercard Send and Visa Direct. These are account transfers, like Venmo and PayPal," said Gunasena.
faster payment services that use the card network rails to He noted several fintechs are also trying to build
move funds from a payer's bank/mobile money account to consumer-to-business use cases, including remittances
the payee's debit card account, not quite in real time but and potentially POS applications, but added it will take
close. time for those to evolve.

Visa recently partnered with Thunes, a business-to- TCH is a 170-year-old banking association and payments
business payments company headquartered in Singapore, company owned by 20 of the nation's largest banks. Many
to support payments to underbanked consumers and of these same banks also own Early Warning Services,
businesses in developing economies. They are using which operates the Zelle P2P payment network. Zelle
Visa Direct, which has a global reach of nearly 7 billion reported it has handled over 5 billion payments totaling

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