Product Code: 66643
The real-time payments market is expected to register a CAGR of 29.8% during the forecast period (2020-2025). The real-time payments typically focus on low-value retail payment systems (RPS); they differ from real-time gross settlement systems (RTGS) and distributed ledger payment systems. In addition to meeting the demands and expectations, real-time payments have generated interest from the regulators, competition authorities and payment service providers alike. Regulators believe that instant payments will expand access to banking services, support economic growth, provide alternatives to Visa/Mastercard networks and reduce the use of cash and cheques.
- The increased penetration of smartphones has meant that currently, customer expectations are high. Individuals expect to be able to make a payment anywhere and at any time, including during evening hours, weekends and on public holidays. They also want to be able to pay for and receive their purchases as fast as possible. Suppliers, on the other hand, want the certainty of payment as soon they release their goods and services. These demands have come into place due to the increased adoption rates of smartphones.
- The reliance on traditional banking has fallen dramatically in the past, with customers demanding more convenience and flexibility. There has been an emergence of new fin-tech payment providers. This has lead to a huge boost to the real-time payments market.
- Lack of Interoperability has affected the market adversely. It has caused the uneasiness amongst the users and thus, restricted the adoption rates of the technology.
Scope of the Report
Real-time payments are instant payments or immediate payments and are defined by the Euro Retail Payments Board (ERPB) as electronic retail payment solutions that are available 24/7/365. Immediate payments enable businesses and consumers to make and receive payments in real time, providing convenience, speed, and faster availability of funds.
Key Market Trends
Bank Led Operating Organisation is Expected to Experience a Major Market Growth
- The distinguishing factor has been the partnership between private sector enterprises that have developed to help modernize the overall ecosystem in the absence of a centrally mandated plan. Not only do these schemes offer a strong value proposition, but they are also developed to enable interoperability to drive ubiquity. In the case of P2P transfers, the linkages with the bank promote the feeling the security in the users.
- Neither banks nor fin-techs can address the global payment market needs alone. Although fin-techs have proven aptitude for technological development, they often lack the industry expertise, working capital, and established client trust that banks have acquired over decades. It is through partnerships, banks, and fin-techs leveraging each other's strengths that payments can be optimized through digitalization.
- Collaborating with clients from an earlier stage is of great importance when developing innovative solutions. Given this, innovation centers physical hubs where banks, fin-techs, and clients can work together to identify and develop transformative solutions - are pivotal to fostering client-centered collaboration.
North America is Expected to Gain Largest Market Growth During the Forecast Period
- Since the first wave of early adopters went live with The Clearing House (TCH)'s RTP network in November 2017, many other large banks have signed on for real-time payment, with hundreds of smaller institutions slated to follow.
- As the merchants and the big institutions recognize the benefits of Real-Time Payments (RTP) in the North America region, the adoption will rapidly get boosted substantially. That is going to be a big driver in new services. merchants and billers, like utilities and health insurers, as they will begin promoting real-time payment methods.
- The main reason for slower adoption in the United States is the lack of mandates. The RTP network represents a new phase of evolution within the U.S. payments industry and provides a platform for product innovation. Financial institutions have started leveraging a variety of features, enhanced speed, security, and messaging capabilities to create unique offerings for their retail and corporate customers.
- Cross-border markets are opening up in the United States creating a huge opportunity for the payers. As the number of immigrants from other countries increases, cross-border disbursements is expected to become more significant, leading consumers and merchants to demand real-time payments. Real-time cross-border funds disbursements could represent an additional market and point of differentiation for payers.
With the consumer preferences changing rapidly, the market has become a lucrative option and thus, have attracted a huge amount of investments. Due to the huge growth potential, the market is moving towards fragmentation due to the new entrants. The service providers are engaging in partnerships to promote product innovation.
- March 2019 - PayPal is cutting down the wait time for users to get access to their cash. PayPal users can now transfer funds instantly to their bank accounts with the introduction of a new feature. The new function is a result of an ongoing partnership with J.P. Morgan Chase that allows the fin-tech company to access a real-time payments network from The Clearing House.
Reasons to Purchase this report:
- The market estimate (ME) sheet in Excel format
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- 3 months of analyst support
Table of Contents
- 1.1 Study Deliverables
- 1.2 Study Assumptions
- 1.3 Scope of the Study
2 RESEARCH METHODOLOGY
3 EXECUTIVE SUMMARY
4 MARKET DYNAMICS
- 4.1 Market Overview
- 4.2 Introduction to Market Drivers and Restraints
- 4.3 Market Drivers
- 4.3.1 Increased Smartphone Penetration
- 4.3.2 Falling Reliance on Traditional Banking
- 4.4 Market Restraints
- 4.4.1 Lack of Interoperability
- 4.5 Industry Attractiveness - Porter's Five Force Analysis
- 4.5.1 Threat of New Entrants
- 4.5.2 Bargaining Power of Buyers/Consumers
- 4.5.3 Bargaining Power of Suppliers
- 4.5.4 Threat of Substitute Products
- 4.5.5 Intensity of Competitive Rivalry
- 4.6 Technology Snapshot
- 4.6.1 By Hours of Operation
- 184.108.40.206 24*7
- 220.127.116.11 Business Hours
5 MARKET SEGMENTATION
- 5.1 By Transaction Types
- 5.1.1 P2B
- 5.1.2 B2B
- 5.1.3 P2P
- 5.2 By Type of Operating Organization
- 5.2.1 Bank Led
- 5.2.2 No-bank Led
- 5.3 By End-user Industry
- 5.3.1 IT & Telecommunications
- 5.3.2 Retail
- 5.3.3 BFSI
- 5.3.4 Utilities
- 5.3.5 Other End-user Industries
- 5.4 Geography
- 5.4.1 North America
- 5.4.2 Europe
- 5.4.3 Asia-Pacific
- 5.4.4 Latin America
- 5.4.5 Middle East & Africa
6 COMPETITIVE LANDSCAPE
- 6.1 Company Profiles
- 6.1.1 ACI Worldwide, Inc.
- 6.1.2 Fiserv, Inc.
- 6.1.3 Paypal Holdings Inc.
- 6.1.4 Mastercard Inc.
- 6.1.5 FIS Global
- 6.1.6 VISA Inc.
- 6.1.7 Apple Inc.
7 INVESTMENT ANALYSIS
8 MARKET OPPORTUNITIES AND FUTURE TRENDS