Everything You Need to Know About Real-Time Payments (RTP®)

RTP is the real-time payments solution from The Clearing House.

Launched in July 2017, the RTP network brought real-time payments to the United States. Today, the RTP network reaches 70% of U.S. demand deposit accounts (DDAs). As of Q3 2024, the network now averages over 1 million payments per day and continues to set new volume records.    

According to The Clearing House, “The RTP network represents a new phase in the evolution of the U.S. payments industry and is providing financial institutions with a modern platform for product innovation. Financial institutions can leverage a wide variety of features – enhanced speed, security, continuous operation, payment status transparency and messaging capabilities – to create unique offerings for their retail and corporate customers.”
 

Consumers and businesses demand safer and faster payments. With RTP, banks and credit unions can innovate to create or enhance digital services for their customers/members.

RTP’s double-digit volume growth each quarter demonstrates consumers’ and businesses’ increasing demand for real-time payments. The banks and credit unions that make payments available in real time with RTP gain a competitive advantage and deliver outstanding customer/member experiences.

In addition, RTP offers the potential for financial institutions (FIs) to create value‑added services through APIs for embedded banking. 

Both RTP and FedNow are real-time payments systems; however, The Clearing House provides RTP, and the Federal Reserve supports FedNow. Both systems offer credit-push payments, immediate funds availability, settlement within seconds, and payments are irrevocable.

These systems are not interoperable, but provider partners support a seamless experience via payment hubs. Banks and credit unions can choose to offer one or both real-time payment solutions. They can choose to start with one and add another or drop one and add another. This becomes easy with a payment hub, which simplifies switching between rails.

The RTP Participation and Operating Rules help to govern transactions on the RTP network and point to applicable regulations. The Clearing House offers rule interpretations as warranted, and the rules are modified on a continuous basis to accommodate new areas of opportunity and questions that arise.

FIs who select a provider partner with an expertise in RTP will have an easier time maintaining compliance as the faster payments landscape and its corresponding requirements continue to evolve.

Surveys regularly show that FIs point to fraud as a top concern in their payment operations, and for RTP, The Clearing House continues to innovate to strengthen fraud protections. For instance, the RTP network now offers the TCH Token Service as an optional capability. It enables FIs to issue tokens to stand in for real account numbers when sending or receiving payments. It’s a way to reduce the potential for theft and fraud.

But banks and credit unions should not solely rely on the network for their fraud protections. Look for a provider partner who can provide integrated real-time fraud monitoring and/or offer APIs that enable you to seamlessly integrate your existing fraud solutions.

In addition, you want to work with a provider partner who can help you identify ways to mitigate operational risks. Look for providers who offer solutions that enable smart routing capabilities to mitigate the risk of payment failures or delays and automatically reroute transactions when necessary.

For general information on RTP, visit The Clearing House website. To explore more about launching RTP with Finzly, speak with one of our payment experts.