Instant payments continue to expand the financial infrastructure of economies worldwide while providing a pivotal technology to areas of lessened financial inclusivity. According to a new report from global technology intelligence firm ABI Research, the number of instant payment transactions for the global top eight platforms (Faster Payments, IBPS, PayNow, Pix, PromptPay, SEPA, UPI, and Zelle) will increase from 213 billion in 2023 to 681.1 billion in 2028.
It is becoming increasingly clear that the demand for instant payments is growing due to several factors, including a global rise in Peer-to-Peer (P2P) payments alongside an expansion in open banking, which is being championed by EU nations. “Account-to-account wallets, which have seen widespread use in P2P transfers, are experiencing increased usage given their use in daily smaller-scale convenient payments between users,” explains Sam Gazeley, Digital Payment Technologies Industry Analyst at ABI Research. “Open banking is widening the available market for prospective users by providing access to instant payments in a streamlined setting, opening the market up to net-new customers and driving financial inclusion.”
While instant payment platforms are compelling for developing economies to drive greater financial inclusion for their users, it is important to consider that there is no one-size-fits-all ownership or operating model for success. It is down to the individual country to define the goals to achieve for developing instant payments within the context of their ecosystem. Success is more likely to be ensured by developing a strategic plan for infrastructure investment and cost recovery and focusing on long-term benefits over short-term profitability.
Technology implementers can consider launching an initial entry-level service to kickstart adoption while ensuring that the design of the instant payment system is adaptable to accommodate diverse use cases, such as emergency payroll or transfers between domestic accounts, driven by the market’s needs, thereby achieving a plug-and-play framework. “Given that different markets address the need for instant payment systems in various ways, it is clear there is no silver bullet as to how such a solution should be implemented. Some countries will opt for brand new systems, while others will support existing offerings with upgrades geared toward instant payment functionalities,” Gazeley concludes.
These findings are from ABI Research’s Market Analysis of National Alternative Instant Payment Platforms application analysis report.
