ACI Blog

Ready or Not? Real-Time Payments Are Coming, and Consumers Can’t Wait

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The 8 consumer types to drive adoption and who has the most to gain from instant payments.

We’re living in a 24/7, instant-gratification world. Consumers expect to be able to buy what they want, when they want, with a single click or swipe. This desire for more choice and instant gratification means that consumers are eager for new and faster ways to pay.

Merchants must recognize and respond to customer needs for checkout diversity to keep their sales experiences hyper-relevant to stay competitive.

Yet, many new customer segments are frustrated by traditional payment options, which invariably revolve around card payments. They want alternatives that offer less cost, greater transparency and better control, both online and in-store. Some younger demographics, especially Gen Zs, do not even have access to credit cards. This is where real-time payments (RTP) come in.

RTPs are the next big thing in retail payments innovation

RTPs have already revolutionized banking, helping to reduce the cost and time involved in moving money online.

As businesses and consumers become accustomed to the convenience of real-time banking, they’re now looking for the same frictionless experience and benefits when buying goods and services from B2C and B2B merchants.

Modern customers want visibility of their cash flow and bank balances in real-time for better money management and budgeting without the frustrating fees, report lags and spend limits that come with using credit cards. They’re also looking for new loyalty schemes and incentives that can help them cope with rising inflation and the increasing cost of living.

RTPs offer all this and more. Transactions are virtually instant, so there is no lag in monitoring spend. There are no card schemes or interchange fees, which means merchants can offset savings to reward loyal RTP users with extra incentives, discounts and promotions.

Is there enough demand to take retail RTPs mainstream?

Like any new payment method, retailers will be looking closely to see where demand lies and where it can help them best capture, engage and differentiate their offering. There are many factors that will help drive RTP uptake. Among these are its relevance and appeal to diverse key audiences, their lifestyles and personal preferences.

Here are just some of the types of shoppers who are most likely to become the first fans of this faster and smarter way to pay:

8 shopper personae who will love RTPs

  • Credit Shunners

Younger consumers are avoiding credit cards due to high fees and fear of debt. . They want the convenience of cards without the fees, making RTPs appealing.

  • Gen Z Debit Divas

More than half (56%) of America’s Gen Z are now using debit cards as their primary payment card. RTPs give them all the advantages of paying straight from their bank account, but with the bonus of real-time transparency, so they can avoid costly overdrafts.

  • Bargainistas

Rising inflation means consumers are looking for better deals. With RTPs, retailers can pass on interchange fee savings as incentives to unlock new types of rewards without eating into their margins.

  • Speedsters

Today’s consumers want everything now . They want to know where their finances are “in the moment” and want payment methods like RTPs that reflect this.

  • Hyper-Cautious

The pandemic taught Gen Z how to be frugal. They’ve begun saving money and investing earlier than previous generations. They also don’t want to be exposed to card fraud. They want secure payment tools, such as RTPs, to lower risks and help them budget better.

  • Smart-Curious

Consumers are hungry for new ways to shop and pay using their smartphones.

  • Side Hustlers and Giggers

Seasonal and temporary workers want to be paid instantly, and RTPs are the ideal solution. And if they’re paid using RTPs, chances are they will want to buy with them, as well.

  • Outliers

 RTPs will resonate with those who have bank accounts but poor credit scores or no credit history and who need a convenient alternative to credit cards for digital payments.

There’s obvious appeal, but how easy are RTPs to integrate and use?

With new solutions like ACI Instant Pay, retailers can easily integrate RTPs into their omnichannel payments mix to make it available to customers across all their channels –online, in-store, via call centers and even in SmartCars.

For customers, once set up, ACI Instant Pay offers a seamless, frictionless, one-click payment option for digital channels. In-store acceptance is super easy, too – shoppers simply use the RTP QR code to scan and pay via their mobile at the checkout.

Because they’re so effortless, RTPs can aid sales conversion. In addition, RTP account validation is done pre-payment, so only insufficient funds can result in a decline. This means that RTPs also offer higher acceptance rates for merchants while minimizing embarrassing declines at the point of sale for their customers.

A chance to shape the future

RTPs have already transformed banking; now it’s the retailers’ turn to reap the benefits. By being the first to embrace this new payment method, they can stand out from the pack, gain a key differentiator and attract a wider cross-section of consumers – especially those who want more visibility, control and convenience. At the same time, retail businesses can benefit from better liquidity and cash flow as well as lower fees.

Being able to offer RTPs is a win-win – not just today but also for the future. Further down the line, RTPs will offer a potential gateway to crucial services, including cross-border transactions. But act fast – the real-time retail revolution is already here.

Discover more about ACI’s merchant real-time payment solutions or contact our payment experts today!

Senior Product Manager

Ankit has more than 13 years of experience in driving payments product innovations for banks and merchants globally. As a PM leader with ACI, he focuses on merchant payment innovations — growth and strategy. Ankit has experience building the global real-time payments engine, Request to Pay, as well as working as a bank auditor for statutory audits for banks in India.