Real-time payments (RTP) settle instantly, allowing funds to be transferred and accessed in seconds. Unlike traditional payment systems, which may take hours or days to clear, RTP ensures immediate processing, regardless of weekends or holidays. It has changed personal, business, and governmental transactions, reducing the reliance on cash and providing an efficient alternative to older electronic payment systems.
A year of excellent growth
According to ACI Worldwide’s Prime Time for Real-Time report, RTP transactions worldwide reached 266.2 billion in 2023, representing a 42.2% year-over-year growth. The increase was driven by various factors, including mobile wallet adoption, digital banking infrastructure expansion, and government-led initiatives to encourage the use of RTP. Strong growth will continue, with a projected 16.7% compound annual growth rate (CAGR) through 2028.
Top real-time payment markets
India continues to dominate the real-time payments market, processing 129.3 billion transactions in 2023, or 48% of the global RTP volume. Initiatives like the Unified Payments Interface (UPI), which offers QR code payments and mobile wallet integration, have driven RTP adoption in India. Other markets experiencing significant growth include Brazil, Thailand, and South Korea.
Below is a breakdown of the leading countries in this sector, highlighting their transaction volumes and growth rates over the past year.
| Country | Transactions (2023) | Year-over-year growth |
|---|---|---|
| India | 129.3 billion | 44.6% |
| Brazil | 37.4 billion | 77.9% |
| Thailand | 20.4 billion | 37.5% |
| South Korea | 9.1 billion | 11.4% |
While these markets lead in transaction volumes, other countries, such as the US and various European nations, are also catching up. The launch of systems like the US FedNow Service and The Clearing House’s RTP network is set to significantly boost real-time payment usage in these regions.
Real-time payments success factors
The expansion of RTP systems globally can be attributed to several key factors. These success drivers are present in countries that have developed real-time payment ecosystems:
- Active collaboration: Governments, financial institutions, and fintech collaborate to create an inclusive and efficient RTP system.
- Merchant incentives: Governments in countries like India have reduced or eliminated merchant fees, making it easier for businesses to adopt RTP.
- User-friendly technology: Mobile wallets, QR codes, and instant payment apps ensure that RTP is accessible to all population segments.
- Cross-border ambitions: Countries like India leverage RTP for cross-border payments, increasing its utility for international transactions.
Why businesses will embrace real-time payments
Real-time payments offer a clear competitive advantage in an era where speed and efficiency are a priority to businesses and consumers. Below are reasons why companies are shifting towards RTP:
- Improved cash flow: RTP enables businesses to receive funds instantly, improving liquidity and allowing for faster investment and expansion decisions.
- Reduced payment processing costs: RTP provides a cost-effective alternative for small and medium-sized enterprises (SMEs).
- Better customer experience: Offering real-time payment options enhances the customer experience, ensuring that transactions are processed instantly. This improves trust and customer loyalty.
- Enhanced security: RTP systems incorporate advanced protocols, including two-factor authentication and encryption. These protocols reduce the risk of fraud, making transactions safer than traditional methods.
Additionally, as governments and financial institutions continue to collaborate on enhancing RTP systems, businesses will benefit from innovations like AI tools that can automate transactions and improve payment processing accuracy. These systems leverage machine learning models to predict and mitigate potential risks, enhancing RTP’s reliability.
The future of real-time payments
Real-time payments are poised to continue their global expansion. While India and Brazil have set the stage, other regions rapidly adopted RTP systems. By 2028, RTP will likely account for more than 27% of all electronic payments globally, with a transaction volume exceeding 575.1 billion. The following trends will drive this growth:
- Increased mobile wallet usage: The adoption of mobile wallets is one of the primary drivers of RTP growth. In 2023, over 90% of consumers in leading RTP markets used mobile wallets to facilitate transactions.
- Expansion of cross-border RTP: Countries in Asia and Europe focus on creating RTP systems that handle cross-border transactions. The bilateral agreements between countries lay the foundation for international real-time payment rails.
- AI integration in RTP systems: AI tools and machine learning models will become increasingly common. These technologies will help detect fraud, optimize transaction processing, predict payment patterns, and reduce operational costs.
Faster, cheaper, safer payments. It’s a win-win
Real-time payments are no longer a niche solution. The benefits of faster, cheaper, and more secure transactions drive businesses and governments to invest in RTP systems. With continued growth expected, RTP will soon become the standard for electronic payments, offering a modern and efficient alternative to traditional methods. With RTP, businesses that embrace real-time payments early will enjoy better cash flow, improved customer satisfaction, and reduced operational costs.