US Bank recently published “4 ways to make practical use of real-time payments,” highlighting how faster payments are enriching the lives of consumers and service providers.  In addition to showing the power of collaborative technologies at work, these examples illustrate how far we’ve progressed in payments and financial services, due in no small part to the efforts and innovations of your team at U.S. Bank and numerous industry stakeholders.

Peter Gordon is an industry leader who has led Real-Time Payments (RTP^R) initiatives and participated in substantive discussions designed to move the RTP needle and leverage advanced technologies. In this exclusive interview, Gordon shares his perspective on how other financial institutions can identify adjacent RTP opportunities and get into the game.

 

Support transactions 24/7/365

As you noted in your June 16, 2022, blog post, “Build, Connect, Innovate: The power of embedded, real-time payments,” RTP is purposely built for our fast-paced, modern economy.

Why is it essential for financial institutions to provide 24/7 access to funds, automated processing and help businesses streamline reconciliation and back-office processing?

 Money is moving faster than ever before, with digital enhancements that are helping us pay, receive and settle funds immediately, making our lives and the ways we transact business more convenient.

The technology and products associated with RTP offer an immediate way to send, receive and request payments for consumers and businesses. It carries data that makes it clear who is paying and what they’re paying for, with proof of payment and peace of mind for both the sender and receiver. RTP leads to better cash management and improved day-to-day operations such as workflow, payroll and supply chain.

The unique features of RTP not only streamline the payments experience, but also help eliminate the wait and risks associated with paper-based payments, batch ACH and traditional wires. RTP allows for real-time payment confirmations, reduced reconciliation costs and faster account opening.

 

Move money efficiently

 Speed, efficiency and funds availability are key benefits of RTP, especially when financial institutions deploy these capabilities at scale. How are these benefits improving back-office efficiencies and the overall bottom line for financial institutions and service providers?

Since the RTP network moves previously manual, inefficient payment processes onto a secure, authenticated payment network, RTP payments enable companies to improve cash flow, manage working capital better and streamline processes – all in a safe manner.

Simply put, RTP presents the greatest opportunity for businesses to take control of their cash flow that we’ve seen in 40 years.

 

Transforming businesses at-scale

We’ve mentioned the ability to deploy these enhanced capabilities at scale. Can you talk about what it means to deliver a “scalable” solution?

It comes down to client needs and expectations, there’s no such thing as one size fits all. We listen to our customers, think about the digital capabilities that can add value to their business and become a one-stop shop for whatever it is they need.

For example, think about all the payments and money movement fintechs out there. They tend to focus on small to midsize businesses. We serve those businesses, and we have the capability to serve corporate and commercial size businesses that are more complex, and their money movement needs might be out of scope for small-scale innovators. These large companies depend on banks like U.S. Bank for service and innovation on their scale – large-scale innovations that accelerate strategic priorities such as digital transformation.

We’ve been working with clients in this large corporate space for years, and it’s something that I love about U.S. Bank. When a big corporate or commercial client asks if we can scale high-velocity money movement, we say, “Of course.”

 

Increased transaction limits, increased opportunities

What does the recent increase for transaction limits on the RTP network from $100,000 to $1 million mean for businesses?

The RTP network was engineered and optimized for million-dollar transactions. The increase in transaction size to $1 million enables a lot of extremely valuable opportunities across industries and segments.

Think about the everyday volumes of high-value transactions in commercial and consumer escrow closings, corporate investments management or auto dealer services. When you increase transaction limits on the network ten-fold, RTP becomes very appealing for many industries.

 

Getting in the game

Clearly, RTP is empowering the entire commerce value chain. How can financial institutions take advantage of these benefits?

Clients want to have the same great digital experience with their bank that they have in other aspects of their lives, so, yes, you could say our digital and tech-led work is driven by our desire to provide our customers with a fantastic digital experience.

We do that by building capabilities in house, but we also partner with fintechs to enhance our offering or expand our reach. You can see it in recent acquisitions U.S. Bank has made over the past couple of years, including TravelBank, Bento and talech.

All three bring exceptional customer experiences to U.S. Bank customers through expense management, digital payments and analytics tools. U.S. Bank is investing in important digital tools that make our customers’ lives easier and ready for whatever comes next.

I’m looking forward to joining everyone in-person and virtually at this year’s Mobile Payments Conference in Atlanta. Until then, I invite you to learn more about how U.S. Bank is helping clients build, connect and innovate.

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Peter Gordon, Head of Emerging Money Movement at U.S. Bank, leads strategy and development for emerging money movement products and services, including Zelle and Real-time payments (RTP). An RTP veteran with over 30 years of global financial services experience, Gordon joined U.S. Bank in 2019 after serving as chief revenue officer at PayFi. He has also held leadership roles at Mastercard, Santander, RBS Citizens, eCom Advisors, First Commons Bank and FIS.