June 15, 2021
We cannot become what we need to be
by remaining what we are ~ anonymous
The country is not living at warp-speed yet, but today’s need-for-speed influences many of our activities: Internet speed, mobile connectivity, automated payments, buy-now-pay-later, fast foods, instant messaging, zoom meetings, in-home movies, speed dating, 5-minute pizzas, supersonic jets, etc. The Internet has turned us into speed-and-convenience seeking consumers with very little patience, unable to tolerate delays in our digital world, inevitably spilling over into our retail world. This type of demanding mindset is influencing The Clearing House’s (TCH) enormous effort to drive the global adoption of same day ACH and real-time payments (RTP). Plus, the pandemic’s restrictive environment has demonstrated the need for RTP which, according to TCH, takes 3 seconds from transaction to receipt of funds.
Since 1853, TCH has become the central clearing institution for the banking industry while owned by the world’s largest commercial banks. They formulate the current payment systems that banks have adopted through the years like checks and electronic payments, with the intention of building the payment systems of the future, specifically digital payments. The Clearing House is putting all its eggs into the real-time payments basket which will force financial institutions and other providers to build an infrastructure around the new powerful payment.
Having read an insightful article on Getting Real about Faster Payments by Patti Murphy, May Green Sheet, the data outlined below will reflect her research:
- 3B real time account-to-account payments processed globally in 2020, 41% up since 2019
- S. 1.2B RTP last year, 9th in world, behind Brazil, India, China, UK
- February 2021, Zelle, a P2P network, combined with RTP sending instantaneous money using the recipient’s mobile # or email
- Zelle and RTP will expand services to businesses for customer bill payment, Venmo and Dwolla will follow
- As opportunities flourish with small businesses, various card payments will be replaced with RTP reducing the interchange revenue paid by merchants
- DraftKings and PartyPoker recently offered immediate payouts thru Mazooma and banked into Fifth Third player accounts
- Instant payroll and insurance payouts have hopped the transition money train to RTP
The adoption of RTP offers huge opportunities for companies to offer simple, transparent, immediate payments in a financial world that is going to be upended if it doesn’t jump on the RTP money train. According to FINRA “Americans are approximately $12.58 trillion in debt,” so who knows, maybe paying with real money instead of plastic will reduce our individual and nation’s outrageous debts. Woo, Woo!
Shawn Princell, CEO of RIBBIT.ai was chosen to lead the development of NACHA’s Faster Payments Professional (FPP) certificate program. This innovative program will give payment professionals a universal vision of faster payments with an emphasis on Same Day ACH and RTP. Princell comments that “earning the FPP credentials will give graduates a unique status, branding them as experts in the faster payment’s arena.” All Aboard!
Stay tuned . . .
Whoever acquires knowledge and does not practice it remembers him who plows his land and leaves it unknown ~ Sa’di Gulistan
What could possibly entice Rick Fiorito, a just-retired, financially secure, new Floridian, and renowned payments-guru to even consider leaving the beach for an opportunity to disrupt the financial services landscape? Rick, at least, let the dust settle from your recent industry-wide retirement announcement from Mastercard. “Joining RIBBIT.ai as their COO is an opportunity I simply couldn’t miss,” Rick knowingly smiles.
Don’t just count your years, make your years count~ George Meredith
Well, well, ACH, what an accomplished, agile 5-year-old you have grown into along with the support of your NACHA parents, encouraging your growth and enhancing your skills every year. Since September 23, 2016, you have matured, up from “13 million payments the first year to over 141 million payments in just the first quarter of 2021, valued at $187.6 billion, increases of 88% and !33% respectively from a year earlier,” according to Payments Post. Motivating Americans to use Same Day ACH has created an addiction for speedy payments which may push payments over 600 million this year.
The biggest problem in the world could have been solved when it was small ~ Bynner
Identity theft is running rampant; my husband was recently a victim when someone tried to take out a loan in his name. Thankfully, the lender turned the thief down and sent my husband a letter explaining the refusal. Good luck with that scam. It felt offensive on two levels: one with the sleazy thief, another with the clueless lender since my husband died five years ago.