Real-time payment is a payment system allowing for immediate transfers of money between bank accounts or payment accounts.
According to the “2023 Prime Time for Real-Time” report, India came on top last year, being responsible for 46% of all global transactions (89.5bn).
Brazil came second, registering 29.2bn in RTP transactions and becoming the third fastest-growing real-time payments market in 2022, with a year-on-year growth of 228.9%.
Both India and Brazil were followed by China (17.6bn), Thailand (16.5bn) and South Korea (8bn).
GlobalData and ACI Worldwide experts estimate that the number of real-time payment transactions will reach 511.7bn by 2027. That means a compound annual growth rate (CAGR) of 21.3% between 2022 and 2027.
In addition, by 2027 real-time payments are expected to make up 28.7% of all electronic payments globally.
“ACI and GlobalData’s new iteration of the Prime Time for Real Time report shows the continuing strong growth trajectory for real-time payments expected in the next five years. With the strong, consistent push in developing markets especially galvanizing usage of these services, global real-time payments are expected to account for over 25% of total global electronic payments by volume by 2027. The time is quickly approaching when real-time payments will be a true challenge to the dominance of cards in electronic payments, even in the West”, said Sam Murrant, Consulting Director, Financial Services at GlobalData.
Craig Ramsey, global head of real-time payments and banking at ACI Worldwide, commented: “This year’s report highlights how consumer and business adoption of real-time payments accelerates when the conditions are right
“The countries at the top of our league table — Bahrain, Brazil and Thailand — are all relatively recent enablers of real-time payments. Concerted industry collaboration and government mandates, widespread merchant adoption, strong brand recognition for a scheme, and related services, such as digital wallets, have provided the perfect combination for strong growth in these markets.”
In response to the growing popularity of RTPs, countries around the world are adapting their legislation to facilitate RTP transactions.
In Europe, the EU Commission has developed a law mandating real-time payments across its 27 member states.
According to the new law, banks must offer instant payments at the same cost or lower than standard credit transfers. The proposed law would disrupt the market significantly, as charges of up to EUR1.50 are standard for instant payments at the moment.
In the UK, the government has embarked on its New Payments Architecture program, aiming to modernise its RTP infrastructure.
Overall, RTP transactions in Europe are expected to reach 34.2bn by 2027, up from 13.2bn recorded in 2022, representing a CAGR of 21%.
In the US, the Federal Reserve announced the launch date for its FedNow service, which seeks to expand real-time payment access in the country.
“Real-time payments are the future of modern, digital economies. Governments and regulators around the world are beginning to understand this and increasingly see them as a path to drive economic growth and financial inclusion”, said Thomas Warsop, interim president and CEO of ACI Worldwide.
“Banks should evaluate whether they are truly maximising existing real-time rails in their market. Ultimately, the extent to which they make real-time payments part of their offering is a strategic decision. It seems increasingly clear, however, that limiting their commitment to the minimum also means limiting their potential share of the future payments market,” Warsop concluded.