ACI Worldwide — GLOBAL PAYMENT TRENDS — Charting the growth of 'immediate payments'

Czech Republic enabled real-time payments in the country with the launch of a domestic real-time payments service in November 2018, which is operated via Czech Express Real- Time Interbank Gross Settlement. Despite limited participation and use cases, real-time payments gradually gained traction in the country and now account for a 3.5% share of the total volume of payment transactions in 2021. The high levels of cash usage and moderate reliance on payment cards provides further growth prospects for real-time payments, helping it to increase both in terms of volume and value at respective CAGRs of 29.0% and 34.4% from 2021-2026.

Key Stats

Real-Time Payment Types

Single Instance

Initiation/Authorization Methods

Bank Account

Year of Real-Time
Payments Launch

2018

Availability

365

24/7

Message Standard

Proprietary

ACI’s Take

Payments executed through the CERTIS real-time scheme are required to be executed in just a few seconds, with performance monitored via time data that participants must collect and report to the Czech National Bank (CNB). CNB’s analysis of these reports shows that the processing time from the moment a payment is sent by the payer’s bank, until it is received by the payee’s bank, is less than 0.5 seconds for half of the payments executed. It is less than 1.5 seconds for 99% of the payments executed.

Twelve of the country’s largest banks are participants in the CERTIS real-time scheme, there is effectively no minimum payment (payments of CZK 0.01 can be made) and the maximum payment is relatively high at CZK 400,000. The scheme also operates 24/7/365. Performance and coverage then are not issues the market must contend with.

What is lacking, however, is a concerted push to drive added-value use cases above and beyond the fast transfer of funds between accounts. Real-time payments are an established part of the market’s payments mix, but they have not penetrated much beyond their initial launch uses cases. Serious merchant offerings are lacking, as are corporate services around high-value and batch-based payments.

Some of this can be put down to the CERTIS scheme’s relative immaturity. But much more of the hesitancy to commit arises from banks’ and other payment players’ lack of conviction around the business case for real-time payments.

There is an element of chicken and egg at play here: some market demand has been proven, but in the absence of more use cases, volumes are not astronomical. To break the status quo and mitigate any perceived risks around investing in new capabilities, banks should turn to vendors with managed payment services offerings and mature cloud capabilities. This would enable them to accelerate time to market on new services, absorb the cost as an operational expense and bake-in the flexibility to either scale up (or down) with demand and pivot to target new opportunities.