Financial Services

Can we benefit more from instant payments?

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Instant payments are the new standard for transferring funds domestically and in the Eurozone. They bring new opportunities and models of behavior not only to our personal life but also to the commercial sphere.

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Consumers using instant bank transfers can receive the goods from e-shops as quickly as they would pay by card. They can easily make an immediate a money transfer even on Sunday. Instant payments provide a high security standard thanks to two-factor authentication or biometric client authentication.

The main benefits of instant payments for e-commerce merchants are the speed of receiving funds and reduced transaction cost. Traditional payment methods, such as bank transfers and card payments, can take several days to complete.

Insurance companies can offer the new services using the immediate payment of claims. Imagine many situations when we need immediate financial coverage for unexpected costs. Property damage and the need for quick repairs, payment to the doctor on vacation abroad, a veterinary examination of pets, car repairs after an accident, and many more.

Why can’t we pay yet for a purchase in a supermarket, gas station or in a taxi by an instant transfer? Or even in a restaurant in Croatia?

In B2B relationships and also in brick-and-mortar shops, there is a need to adjust whole set of business processes so that instant payments can provide the same comfort and user experience as widely used card payments.

This opens multiple opportunities for integration projects in the area of Open banking, ERP systems. Information about an incoming instant payment must be transferred from the recipient bank to the merchant's ERP system in real-time, then delivered just as quickly to a specific point of sale to the cash desk system. Paid! And the consumer takes home the purchased goods.

The question remains, however, how quickly the instant payment method will spread in ordinary stores and how popular it will be among the customers. The motivation of merchants to offer such a new payment method will also play an important role. Will banks co-operate with merchants to integrate the new payment method into merchants’ loyalty apps, or will new players offer an entire ecosystem based on instant payments with an attractive business model for all involved parties?

At Trask, we assist our clients to define innovative payment roadmap, optimize their payment infrastructure and implement the new payment methods.

Michal Hladík, Head of Payment Transformation Services

Michal has been working in banking and financial services advisory for more than 20 years. During that time, he has implemented many transformation projects, especially in the area of payments and cards. In Trask, he has been leading the Competence Centre for Payment Services for three years.


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