Payments

William Mills Agency study finds real-time payment adoption growing amid banks

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August 28, 2024

William Mills Agency and FI Navigator released a study examining financial institution data that tracks FedNow and real-time payments. It found that real-time payment adoption is growing amid banks, although credit unions are not growing as quickly, according to a press release.

In particular, 33.3% of credit unions with $10 billion or more in assets have adopted real-time payments, compared to 7.9% with $100 million to $500 million and 1.2% for those with less than $100 million.

Since the release of FedNow, 900 financial institutions have joined the service, Dean Nolan, managing director for SRM, said in the release.

"Financial institutions need to focus on educating stakeholders on the benefits and barriers. Fraud prevention and a solid business case are the main barriers to instant payment adoption. While these need to evolve, current risk controls and the value of both sending and receiving payments are sufficient for many financial institutions to move forward now," Nolan said.

In addition, Jack Henry is now supporting about 30% of banks on the FedNow Service and around 50% on the RTP Network, Tede Forman, president of payment solutions at Jack Henry, said in the release.

"We're looking at a very healthy queue to onboard both networks that continues to grow. There's still lots of growth opportunity, though, particularly with credit unions, which make up about 30% of the FIs we're supporting today on both networks. I think the success we've had in helping institutions with faster payments can be attributed to three things. First, our faster payments hub, JHA PayCenter, makes onboarding quick and easy," Forman said. "There's very little hassle in getting up and running in a Receive status, which has helped our FIs grow deposits. Next, we have been relentlessly focused on educating everyone on the benefits and evolving use cases for real-time payments. And finally, thanks to our long and successful relationship with The Clearing House supporting hundreds of FIs for years on that network, we really had a running start."