Like nothing before, remember the first time when you made a digital payment? Or the first time when you ordered a Pizza online? Although worried about the transaction, how exciting was it to make the first digital payment?
Well, the e-payments evolution, of course, began with the internet, the great revolution that changed the world. If there were no World Wide Web, how would it make a difference?
Today, digital payments are driving the fintech space – relatively faster and potentially cheaper. Day-by-day, the banking industry is getting closer to adopting real-time payments. Above all, they are universally affordable and accessible. Beyond peer-to-peer (P2P) and enterprises, digital payments are spreading across the markets.
The evolution of digital and mobile banking had seen significant growth. As a result, digital banking made it possible to conduct funds transactions in a fraction of seconds. The real-time payments made it easier for individuals and businesses to make payments more quickly, with funds being credited immediately to the recipient bank.
The real-time settlements eliminated the additional expenses by removing the high-cost wire transfers. Needless to say, we got rid of paper checks and invoices too. Above all, digital payments provided the opportunity to keep an eye on the accounts, spendings, and overdrafts. Instant money transfers, fewer transaction fees took a sharp jump in the digital world.
The pandemic changed the way we conduct transactions. Across the world, online stores like Bigbasket, Amazon, Flipkart, etc., played a significant role in our day-to-day essentials. Consequently they created a major dependence on digital payments. Card transactions, UPI apps, net banking are being extensively utilized instead of cash transactions.
Due to the current scenario, businesses are creating and developing digital payment platforms like eWallets, UPI apps, and net banking.
The real-time payments had good progress, and thus, we will definitely see drastic developments in the future.
“The U.K. had a faster payment since 2008; sterling payments were settled instantaneously or at most within two hours. In contrast, the U.S. had a longer transaction time to settle payments. But now, the U.S. is also catching up with the payment technologies to roll out faster payments.”
The Game Changers
Mobiles phones with an internet connection made digital payments handy. From anywhere, at any time, one can shop online or do funds transfer easily. Most of the offline stores also switched to digital payments. Therefore allowing customers to pay by scanning code and paying through UPI quickly. The smart world with smart technology is turning out to be popular than the traditional banking system.
In November 2017, RTP (Real-Time Payments) network became a reality in the U.S.
The Clearing House, a payments consortium of 25 banks and various technology companies, launched real-time payments. The RTP was the first new payment system in the U.S. in 40 years. The network was introduced to clear and settle payments in real-time. Relatively, the network was used by the federally insured depository and other financial institutions to create and deliver products and services to their customers.
The digital cash flow was made easy and available by the RTP network. RTP technology benefited consumers in several ways. It enabled to send and receive payments 24/7, 365 days a year. There was no need to create a new account.
Instead, RTP allowed users to initiate fund transfers from their existing accounts, and simplified money management, & reduced fraudulent activities. Thus, the RTP network made it possible to conduct real-time payments in a faster and safer way.
The so-called “Generation Z” born after 1995, around 69 percent use mobile banking apps.
Compared to only 17 percent of the baby boomers (born between 1945 and 1965). Based on this, mobile P2P payments like Venmo, Paypal’s mobile app have become the leaders in the U.S. market and are working to evolve with countless features.
The U.S. real-time payments ecosystem will soon witness several other payment applications coming in. PayCircle, with its diversified features, will be one among them.
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