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RELATED: Technological innovation will be key for growth in maturing payments industry
This rapid rise will be driven by two major trends: the increasing adoption of instant payments in Europe, driven by regulation, and the rising usage of FedNow in the US. The research highlighted the central role of FedNow in transforming the inefficient US payments ecosystem.
“While instant payments have been in the US for a while, FedNow promises to take instant payments to a new level of scale; providing broad access and reach. Achieving this transformation will require stakeholders throughout the payments ecosystem to reimagine their processes, with slow-to-move vendors being left behind,” explained Nick Maynard, VP of Fintech Market Research at Juniper Research.
Value-added Services Critical to Success
The research identified value-added services, particularly those such as Confirmation of Payee systems which combat fraud, as critical to unlocking mainstream instant payments’ success. With Authorised Push Payment (APP) fraud surging across different markets, as scammers use social engineering to defraud users, building fraud controls into instant payment system roll-outs is critical to long-term success.
“With scams more prevalent than ever, securing instant payment systems is vital. The inherent speed of the transaction places pressure to detect fraud in real-time, and even in the set-up process before the payment. Pairing instant payments roll-outs with fraud detection advancements is vital to ensuring the modernisation of payments does not come at the cost of a deluge of fraud,” Maynard concluded.
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