AMR Future Brief| Accelerating Financial Transactions: The Impact of Real-Time Payments on the Global Economy

In the dynamic landscape of finance, real-time payments have emerged as a key solution, redefining how money moves in the digital age. With the growing demand for faster, more efficient financial transactions, real-time payment systems have gained huge popularity, offering benefits that extend across consumers, businesses, and financial institutions.?

Understanding real-time payments?

Real-time payments refer to digital transactions that are initiated, processed, and settled instantly. Unlike traditional payment methods that take hours, days, or even weeks to clear, RTP systems enable the immediate transfer of funds between bank accounts, providing services 24/7 around the clock. The biggest advantages of these systems lie in their speed and convenience, making them a preferred method for a wide range of transactions, from peer-to-peer payments to business-to-business transactions.?

In the past few years, the changes in consumer behavior, and the growing demand for cashless economies have increased the widespread adoption of these financial technologies. Several nations such as United Kingdom, India, and Australia have already implemented RTP systems successfully, taking a prominent step toward boosting digitalization.??

The use of modern technologies in real-time payments?

The backbone of RTP systems is a combination of advanced digital infrastructure and robust regulatory frameworks. These systems rely on modern payment networks that use a variety of technologies, including Application Programming Interfaces , cloud computing, and blockchain, to facilitate the seamless transfer of funds. APIs play an important role in enabling real-time payments by allowing different financial systems to communicate with each other in real-time. This technology is the key component of open banking, which promotes greater transparency and competition in the financial industry. It enables third-party providers to access bank data and offer innovative payment services.??

Moreover, cloud technology provides the scalability and flexibility required to handle the vast volumes of transactions processed in real-time. By leveraging cloud platforms, payment service providers ensure high availability, speed, and security. In addition, blockchain technology offers a decentralized, transparent, and secure way to process real-time payments. It has the potential to eliminate intermediaries and reduce transaction costs, making it an attractive option for the future of real-time payments.??

Worldline and TransNetwork’s bold acquisitions to transform banking solutions in 2024?

In June 2024, Worldline, a leading provider of full payments value chain in France and Europe announced its acquisition of Credem, a renowned Italian bank to expand its merchant’s payments businesses. According to a report published by Reuters, a global news agency, this agreement has showcased the rising investments made by banks to bring new technological advancements. Previously, Credem was partnered with Nexi, the biggest payments group in Europe, for its payment solutions. However, sources of Reuters said that Worldline outbids Nexi by valuing Credem’s business at up to around $131 million, giving a double-digit multiple to core profit. Moreoever, Worldline also teamed with Visa to launch a virtual card-issuing solution focused on the online travel agency market, enabling Credem to make an entry to direct card issuance and strengthen its position in e-commerce channels.??

Similatly, in May 2024, TransNetwork, a B2B electronic domestic and cross-border processing and payment platform?? acquired Inswitch,? a cloud-based finance-as-a-service platform. Through this agreement, TransNetwork aimed to accelerate the development of its digital product suite for facilitating cross-border payments across Latin America. This acquisition has helped Inswitch to enhance its regional expertise and expand its embedded financial technology solutions. The company’s financial solutions are offered via an application programming interface (API)-based core platform that has improved TransNetwork’s business-to-business payments network and instant money movement capabilities. With this agreement TransNetwork has taken a major step toward transforming the instant cross-border payments industry by enhancing payments processing platform through innovative digital products and capabilities. Together, the companies aimed to offer white-label digital wallets, cross-border and domestic payments, full-service issuance and processing of physical and digital cards. They also envisioned to provide a pay-in and pay-out network that includes bank, card acquiring, cash, and wallets.??

AMINA Bank’s new initiative to facilitate payments for crypto banking customers?

In June 2024, AMINA Bank, a Switzerland-based digital assets bank launched AMINA Payment Network (APN) to provide easier fiat payments methods for crypto banking customers. The bank has unveiled the AMINA Payment Network to streamline real-time payments among its members, boosting crypto banking and enhancing seamless financial transactions. APN supports CHF, EUR, and USD payments between APN members, providing flexibility and efficiency for individuals and businesses. The bank has planned to add more currencies to the network in the near future. The APN is currently available to existing AMINA Bank clients who can join with an introductory offer of zero membership and transaction fees. This launch of APN solidifies AMINA Bank’s role as a prominent player in crypto banking.?

In a nutshell, real-time payments have significantly transformed the financial ecosystem in the era of digitalization. RTP systems have become the strongest pillar in the global payment infrastructure by offering matchless speed, convenience, and efficiency. Moreover, the integration of these advanced systems with emerging technologies such as artificial intelligence, the Internet of Things, and digital currencies is expected to open new possibilities for instant, seamless, and secure financial transactions in the future.?

To gain more insights into the rising advancements in real-time payments, feel free to talk to our industry specialists today! You can also chat with them for any further queries.??

? **?????????????? ????????????: Rosy Behera ?

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