This is an exciting time for Payments NZ to be scoping out the nation’s next-generation, account-to-account, real-time payments ecosystem.
Real-time payment volumes are growing globally.[i]
The number of real-time transactions in 2022 — a new high, representing 63.2% growth year on year
Forecasted transaction volumes for 2027, a compound annual growth rate of 21.3%
By 2027, real-time payments are expected to account for more than one-quarter of all electronic payments globally (up from 18% in 2022).
Faster, more efficient payments have been proven to drive economic benefits
For Aotearoa New Zealand, these economic benefits could be significant:[ii]
Predicted cost savings by 2027 for businesses and consumers facilitated by real-time payments
Projected additional economic growth by 2027 (or 0.1%)
But how will Aotearoa New Zealand get there?
The relatively small scale of the Aotearoa market may discourage a high level of capital investment in payments infrastructure seen in markets such as Australia. Yet that shouldn’t be an obstacle to creating a highly resilient, agile, secure, extensible and scalable next-generation payments system.
Key features of Aotearoa’s next-generation payment systems must include:
A modular and flexible architecture to support a roadmap for growth
Both central infrastructures and banks’ own systems must be built with extensibility in mind, so that they can efficiently and reliably support current ecosystem requirements and respond to future ones quickly and cost-effectively.
Standardized, API-led connectivity to drive innovation and promote openness
Leveraging API-led integrations will lower the technical burden of scheme compliance, enabling innovators in the wider tech community to access the new payment rails and develop added-value overlay services on top of them.
The ISO 20022 messaging standard is the basis of every modern payments system, enabling the transmission of more structured, richer transaction data that can be leveraged for value-added services, such as enhanced reconciliation.
Fraud Prevention From Day One
New payment types mean new fraud risks, so banks and central infrastructures must prioritize enterprise-level, machine learning-driven fraud prevention and security systems from day one.
Account-to-account real-time payments are set to revolutionize Aotearoa’s economy. They will help business grow, increase convenience for individual Kiwis, and drive financial and technological innovation.
For more insights into key developments and trends in next-generation payments, and the ecosystem features that best drive adoption, read ACI’s Prime Time for Real-Time 2023 or Real-Time Payments and the Future in Aotearoa New Zealand.